The North American Secure Horizon Accelerator is a fixed index annuity offering up to 17% premium bonuses, principal protection, and an innovative Performance Strategy Ladder with participation rates reaching 500%. It’s designed for retirement savers who want market-linked growth without risking their principal. The partial Roth conversion feature adds unique tax planning flexibility you won’t find in most annuities.
If you’re researching the North American Secure Horizon FIA, you’re probably trying to figure out whether it’s worth the 10-year commitment. We get it. There’s a lot of marketing hype around premium bonuses and participation rates, and it’s hard to know what actually matters.
We’ve spent over 30 years helping clients evaluate annuity products like this one. In this review, we’ll break down how the Secure Horizon Accelerator actually works, what the fine print says about those impressive bonus numbers, and who this product makes sense for. No sales pitch, just straight talk about what you’re getting.
What Is the Secure Horizon FIA?
The North American Secure Horizon is a single premium deferred annuity issued by North American Company for Life and Health Insurance. It comes in two versions: the base Secure Horizon and the Secure Horizon Accelerator. Most people gravitate toward the Accelerator version because of its premium bonus.
Here’s what you need to know upfront:
- Minimum premium: $25,000 (qualified or non-qualified money)
- Issue ages: 0-79
- Surrender period: 10 years
- Premium bonus: Up to 17% with the Accelerator version
The 10-year surrender period is the trade-off for those attractive bonus rates. If you might need this money sooner, that’s a deal-breaker worth discussing before you sign anything.
The Premium Bonus: What You Actually Get
The Accelerator version offers up to a 17% premium bonus (13% base plus a 4% promotional bonus). So if you put in $250,000, you’d start with $292,500 in accumulation value. That’s real money added to your account on day one.
But here’s what the marketing doesn’t always emphasize: the bonus amount varies by state. Some states cap the bonus at 16% instead of 17%.
17% bonus states: Alabama, Arizona, Arkansas, Colorado, DC, Florida, Georgia, Iowa, Illinois, Kansas, Kentucky, Maine, Michigan, Mississippi, Nebraska, New Mexico, North Carolina, North Dakota, Rhode Island, South Dakota, Tennessee, Vermont, West Virginia, Wisconsin
16% bonus states: Alaska, California, Connecticut, Delaware, Hawaii, Idaho, Indiana, Louisiana, Maryland, Massachusetts, Minnesota, Missouri, Montana, Nevada, New Hampshire, New Jersey, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Texas, Utah, Virginia, Washington, Wyoming
There’s also a recapture provision. If you withdraw more than the penalty-free amount during the surrender period, the insurance company takes back a portion of that bonus. The recapture percentage starts at 100% in year one and declines to 0% by year ten. Penalty-free withdrawals, death benefits, and nursing home waivers don’t trigger recapture.
How the Performance Strategy Ladder Works
This is where the Secure Horizon gets interesting. The Performance Strategy Ladder is North American’s crediting method that automatically spreads your money across five different term lengths.
Here’s the concept: 20% of your premium goes into each term length (1, 2, 3, 4, and 5 years). Longer terms offer higher participation rates because the insurance company has more time to manage the investments. As each strategy matures, it rolls into a new 5-year term.
Participation rates by term length:
| Term Length | Participation Rate |
|---|---|
| 1-year | Currently up to 160% |
| 2-year | Currently up to 310% |
| 3-year | Currently up to 400% |
| 4-year | Currently up to 450% |
| 5-year | Currently up to 500% |
Note: Actual rates may vary based on market conditions and index selection at the time of purchase.
Those participation rates look incredible on paper. A 500% participation rate means if the index gains 10%, you’d be credited 50%. But remember, these are maximums that vary by index and current market conditions. The actual rates you receive will be set when your contract is issued.
You can also add a 0.95% annual strategy charge to boost participation rates even higher. Whether that makes sense depends on how you expect the underlying indices to perform.
Available Index Options
The Secure Horizon offers five indices, each serving a different purpose:
Loomis Sayles Managed Futures 2 Index provides alternative strategy exposure. It’s designed to perform differently than traditional stock indices.
NYSE GEARS Index offers volatility-controlled equity exposure. It dials back risk during turbulent markets.
Research Affiliates Global Multi-Asset Index spreads across multiple asset classes for broad diversification.
S&P 500 Low Volatility Daily Risk Control 5% Index gives you equity participation with built-in guardrails against big swings.
S&P PRISM Index offers enhanced equity exposure with risk management features.
Most clients don’t need to pick just one. The Performance Strategy Ladder lets you allocate across multiple indices based on your risk tolerance and goals.
Accessing Your Money
You’re not completely locked in for 10 years. Starting in year two, you can withdraw up to 7% of your beginning-of-year accumulation value without penalties. No surrender charges, no market value adjustment, no bonus recapture on these amounts.
If you need more than 7%, you’ll face surrender charges starting at 10% in year one and declining each year. There’s also a market value adjustment that can work for or against you depending on interest rate changes since you bought the contract.
One important note: Required Minimum Distributions from qualified accounts are exempt from surrender charges. If you’re using IRA money, you won’t get penalized for taking your RMDs.
The Partial Roth Conversion Feature
This is genuinely unique. For contracts issued February 1, 2024 or later, you can gradually convert portions of your traditional IRA annuity to Roth status without surrendering the whole contract.
Here’s how it works: You request a partial Roth conversion of at least $5,000. North American creates a “mirror” Roth contract with all the same features as your original. You can do multiple conversions over time, spreading out the tax hit across several years.
Why does this matter? Roth accounts don’t require distributions during your lifetime, and your beneficiaries receive the money tax-free. If you expect tax rates to rise or want to reduce your future RMD burden, this feature gives you flexibility most annuities don’t offer.
The converted amount is taxable income in the year you convert. Talk to your tax advisor before pulling this trigger.
Real Numbers: A Client Illustration
Let’s look at how this plays out with actual numbers. Take a 55-year-old client in Alabama putting in $250,000 using the S&P PRISM Index with the Performance Strategy Ladder:
Starting position:
- Initial premium: $250,000
- 17% bonus: $42,500
- Day-one accumulation value: $292,500
Participation rates for this illustration:
- 1-year terms: 95%
- 2-year terms: 125%
- 3-year terms: 140%
- 4-year terms: 150%
- 5-year terms: 185%
10-year projected outcomes (based on historical periods):
- Most recent period (2014-2024): 7.49% effective rate, ending value $419,199
- Best historical period (2011-2021): 10.25% effective rate, ending value $540,072
Even in the lower scenario, the original $250,000 grew to over $419,000. And in all scenarios, the guaranteed minimum protects your original $250,000 principal.
The Accumulation Value True-Up
Here’s a feature that doesn’t get enough attention. At the end of your 10-year surrender period, North American calculates whether your total interest credits exceeded your total strategy charges. If they did, you get a one-time bonus credit.
Think of it as insurance against underperforming strategies. If one index didn’t do well but others crushed it, the True-Up helps balance things out. This only applies if you haven’t taken excess withdrawals during the surrender period.
Who Should Consider This Annuity?
The Secure Horizon Accelerator works well for:
Pre-retirees (ages 50-65) who have 10+ years before needing the money and want to lock in growth potential while protecting principal.
Tax-conscious planners who want to use the partial Roth conversion feature to manage their tax burden over time.
Conservative investors who like the idea of market participation without the risk of market losses.
Estate planners who want to pass tax-advantaged money to beneficiaries.
It’s probably not right for you if you might need significant liquidity before year 10, or if you’re uncomfortable with a long-term commitment even with the penalty-free withdrawal option.
Frequently Asked Questions
How does the premium bonus recapture work?
If you withdraw more than 7% annually during the surrender period, North American recaptures a portion of your bonus. The recapture starts at 100% in year one and drops by 10% each year until it hits zero in year ten. Penalty-free withdrawals, death benefits, and nursing home waivers don’t trigger recapture.
Can I lose money with this annuity?
Your principal is protected. Even if the indices perform poorly, you won’t lose your original investment. You might earn zero interest in a bad year, but you won’t go backward. The guaranteed minimum equals your original premium.
What happens if I need all my money before year 10?
You can surrender the contract, but you’ll pay surrender charges starting at 10% in year one, potentially face a market value adjustment, and trigger bonus recapture on any amount above your cumulative penalty-free allowance. It’s expensive, which is why this product requires a genuine long-term commitment.
How do the partial Roth conversions affect my surrender value?
Converted amounts move to a separate Roth contract with identical features. Your surrender period and charges continue as normal on both contracts. The conversion itself doesn’t trigger surrender charges as long as you stay within penalty-free limits.
Is the 17% bonus too good to be true?
The bonus is real, but it’s not free money. The 10-year surrender period and potential recapture provisions are the trade-offs. Insurance companies can offer these bonuses because they’re investing your money over a long time horizon. If you stay the full term, you keep the entire bonus.
Key Takeaways
- Premium bonus up to 17% adds immediate value, but comes with a 10-year surrender period and recapture provisions
- Performance Strategy Ladder offers participation rates up to 500% by spreading your money across multiple term lengths
- Principal protection means you can’t lose your original investment, even if markets decline
- 7% annual penalty-free withdrawals starting in year two provide some liquidity without charges
- Partial Roth conversion feature offers unique tax planning flexibility for IRA money
- Best fit for pre-retirees with a 10+ year time horizon who want growth potential without market risk
Want help figuring out if this fits your situation? We’re happy to walk through the numbers with you. No pressure, just an honest conversation about whether the Secure Horizon makes sense for your retirement goals.
