Annuities

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When an annuity is written, whose life expectancy is taken into account

Annuitant

A couple near retirement is planning for their golden years. They want to make sure that their retirement annuity provides monthly benefits for the rest of their lives. She's one of them died the other would still like to continue receiving benefits which settlement option should they choose

Joint and survivor

A married couples retirement annuity pays them $250 per month. the husband dies and his wife continues to receive $125.50 per month for as long as she lives. When the wife dies, payment stop. What settlement option did they select

Joint and survivor

A couple of receives a set amount of income from their annuity. When the wife dies the husband no longer receives a new ID payments. What type of annuity did a couple buy?

Joint life

What happens if a deferred annuity is surrendered before the annuitization period

The owner will receive the surrender value of the annuity

Unlucky individual won the state lottery, so the state will be sending him a check each month for the next 25 years. What type of annuity products are they likely to use to provide these benefits

Immediate annuity

Which of the following best describes what the annuity period is The period of time from the effective date of the contract to the day of its termination The period of time during which accumulated money is converted to income payments The period of time from the accumulation period To the annuitization period The period of time during which money has accumulated in an annuity

The period of times during which accumulated money is converted into income payments

Why is an equity indexed annuity considered to be a fixed annuity?

It has a guaranteed minimum interest rate.

The president of the company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true? The annuitant must be a natural person A corporation can be an annuitant as long as it is also the owner A corporation can be in annuitant as long as the beneficiary is a natural person The contract can be issued without an annuitant

The annuitant must be a natural person

All of the following statements about equity index annuities are correct except The annuitant receives a fixed amount of return They have a guaranteed minimum interest rate The interest rate is tied to an index such as the standard and poors 500 They invest on a more aggressive basis aiming for higher returns

The annuitant received a fixed amount of return

In an annuity, The accumulated money is converted into a stream of income during which period

Annuitization period

Under which installments option does the annuitant select the amount of each payment and the insurer Determines how long they will pay benefits

Fixed amount Under the installments for a fixed amount option, the annuitant selects the amount of each payment, and the insurer determines how long they will pay benefits. This option pays a specific amount until the funds are exhausted. There are no life contingencies.

Which of the following is not true regarding the accumulation period of an annuity? It is the period during which the annuity payments earn interest It is the period over which the owner makes payments into an annuity It is also known as the pay in period It would not occur in a deferred annuity

It would not occur in a deferred annuity

The annuity owner dies while the annuity is still in the accumulation stage. Which of the following is true? The money will continue to grow tax deferred until the liquidation period, and then will be paid to the beneficiary The beneficiary will receive the greater of the money paid into the annuity or the cash value The owner is a stable receive the money paid into the annuity The insurance company will retain the cash value and pay back the premiums to the owners estate

The beneficiary will receive the creator of the money paid into the annuity or the cash value

The annuity owner dies during the accumulation. Without naming a beneficiary. Annuities cash value exceeds premiums paid. Which of the following is true? The cash value will be paid to the state government The cash value will be paid to the annuitants estate The premium value will be paid to the annuitant estate All benefits will be forfeited

The cash value will be paid the annuitants estate


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