Delaware Life Insurance Company has made headlines by becoming the first U.S. insurance provider to introduce a fixed index annuity (FIA) that is linked to a cryptocurrency-focused index, specifically the BlackRock U.S. Equity Bitcoin Balanced Risk 12% Index. This innovative offering enables retirement investors to access indirect exposure to Bitcoin while ensuring principal protection, a characteristic traditionally associated with annuity products.
The newly launched index features a strategic allocation: 74% is invested in the iShares Core S&P 500 ETF, 25% in the iShares Bitcoin Trust ETF (IBIT), and 1% in cash. Designed with a target volatility of 12%, the index employs dynamic cash adjustments aimed at moderating the price fluctuations of Bitcoin (BTC).
Robert Mitchnick, Global Head of Digital Assets at BlackRock, emphasized the significance of this launch, which is grounded in the substantial success and demand for the IBIT product. He noted, “This index offers a measured approach, enabling policyholders to engage with digital assets while preserving the downside protection they expect from traditional annuity products.”
Colin Lake, Delaware Life’s CEO of Marketing, highlighted the company’s commitment to innovation within the retirement-planning sector. “We’re proud to partner with BlackRock as the first insurance carrier to offer cryptocurrency exposure through a fixed index annuity,” he stated. Lake underscored the company’s goal to continuously innovate to cater to the evolving preferences of financial professionals and their clients, providing opportunities for growth alongside essential protection.
The index’s mixed allocation is specifically designed to balance traditional equity growth with the high return potential of Bitcoin, all while managing volatility. As of December 31, 2024, the index reported a six-month return of 1.88%. However, the recent downturn in Bitcoin’s price over the previous three months contributed to a 3.16% drop during that timeframe.
The BlackRock U.S. Equity Bitcoin Balanced Risk 12% Index is now available through three of Delaware Life’s FIA products: Momentum Growth™, Momentum Growth Plus™, and DualTrack Income™. This variety allows clients multiple options for integrating Bitcoin exposure into their retirement portfolios. Notably, the inclusion of IBIT, which is recognized as the largest and most liquid Bitcoin exchange-traded product, enables clients to benefit from professional management without necessitating direct ownership of cryptocurrencies.
This pioneering move marks the first instance in which a life insurance company has allowed policyholders to select a product that incorporates Bitcoin. Currently, the price of Bitcoin stands at $87,774, reflecting a 2% decline within the last 24 hours, accompanied by a trading volume of $64 billion over the same period.
