Hewitt EnnisKnupp Sample Annuity Pricing Rates February 28, 2014 Immediate Annuity Rates Low High 3.11% 3.41% 3.12% 3.42% 3.36% 3.66% 3.22% 3.52% 3.09% 3.39% 3.17% 3.47% 3.29% 3.59% 3.15% 3.45% 3.11% 3.41% 2.66% 2.96% 2.32% 2.62% 2.48% 2.78% 2.56% 2.75% Rates as of: 2/28/2014 1/31/2014 12/31/2013 11/30/2013 10/31/2013 9/30/2013 8/31/2013 7/31/2013 6/30/2013 5/31/2013 4/30/2013 3/31/2013 2/28/2013 Deferred Annuity Rates Low High 3.79% 4.17% 3.86% 4.24% 4.11% 4.49% 4.02% 4.40% 3.82% 4.20% 3.88% 4.26% 3.97% 4.35% 3.89% 4.27% 3.78% 4.16% 3.34% 3.72% 2.95% 3.33% 3.12% 3.50% 3.23% 3.61% Note: Pricing interest rates can vary for many reasons. For estimate purposes, the low end of the range should be the starting point for cases that have complex plan provisions, contain data that has not been scrubbed, have cash balance and/or employee contributions, etc. Extra conservatism for such circumstances should possibly be added to lower the estimated rate even further. Deferred annuity rates should be applied to the full lifespan of deferred participants. There is no need to adjust the rate post-retirement. Historical Sample Annuity Pricing Rates 7.0% Deferred Rate (Duration=15) Immediate Rate (Duration=7) 6.0% 30-Year Treasury Rate 10-Year Treasury Rate Interest Rate 5.0% 4.0% 3.0% 2.0% Mar-14 Dec-13 Jun-13 Sep-13 Mar-13 Dec-12 Jun-12 Sep-12 Mar-12 Dec-11 Jun-11 Sep-11 Mar-11 Dec-10 Jun-10 Sep-10 Mar-10 Dec-09 Jun-09 Sep-09 Mar-09 Dec-08 Jun-08 Sep-08 Mar-08 Dec-07 Jun-07 Sep-07 Mar-07 1.0% Note: Rates are derived from an HEK survey completed by ten insurance companies currently active in the marketplace. (Data since 3/31/2013 excludes two companies currently on bidding hiatus.) The rates since 2011 are derived from the highest (most aggressive) interest rates available in the marketplace on plain vanilla cases as of the last working day of the calendar month. Since rates vary so much intraday, quotes are generally only held open for a couple of hours on the day they are published. Institutional Annuities and Life Insurance Solutions Team Steve Shepherd | steve.shepherd@aonhewitt.com | 203.523.8164 Jay Dinunzio | jay.dinunzio@aonhewitt.com | 203.523.8831 Jennifer Lawrence | jennifer.lawrence@aonhewitt.com | 610.834.2271