Chapter Exam - Annuities

How does an indexed annuity differ from a fixed annuity?

Indexed annuity owners may receive credited interest tied to the fluctuation of the linked index

K is an annuitant currently receiving payments. If she were to die before receiving payment equal to the correct value, a beneficiary will continue receiving payments until an amount equal to the contract value has been paid. This is called a(n)

Installment Refund annuity

T has annuity that guarantees an income payment for the rest of his life. The contract also guarantees that if T dies before receiving payments for 20 years, the remaining payments will be paid to his son for the balance of the 20 years. What type of annuity if this?

Life Annuity with Period Certain

What type of annuity has a cash value that is based upon the performance of it's underlying investment funds?

Variable

Which of the following is NOT included in an annuity contract?

AD&D rider

P is a forty year old woman and would like to purchase an annuity that will provide a lifetime income stream beginning at age sixty. Which of the following did she NOT buy?

An immediate annuity

N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?

Fixed Deferred

W is a 39-year old female who just purchased an annuity to provide income for life starting at age 60. All of these would be acceptable annuity choices, EXCEPT a(n):

Immediate annuity

The annuity that represents the largest possible monthly payment to an individual is a(n):

Straight Life annuity

A contract owner terminated an annuity before the income payment period begins. The owner will then receive

the current contract surrender value