Annuities

An insurance company forwards fixed annuity premiums to their general account, where the money is invested. The guaranteed minimum interest is set at 2.5%. During an economic downswing, the investments only drew 2%. What interest rate will the insurer pay to its policy holders?

2.5%

Which of the following is not fundable by annuities?

Death benefits.

All of the following statements are true regarding installments for a fixed annuity settlement option except?

It is life contingency option.

Which terms are associated directly with the way an annuity is funded?

Single payment or periodic payments.

Which of the following types of annuities will generally provide the highest monthly income?

Straight life.

All of the following are true of an annuity owner except?

The owner must be the party to receive benefits.

Which of the following is true regarding the annuity period?

It may last for the lifetime of the annuitant.

Which of the following is not a term for the period of time during which the annuitant or the beneficiary receives income?

Depreciation period.

If an annuitant dies before annuitization occurs, what will the beneficiary receive?

Either the amount paid into the plan or the cash value of the plan, whichever is the greater amount.

An agent selling variable annuities must be registered with?

FINRA.

According to the non forfeiture law, if the owner decides to surrender a deferred annuity prior to annuitization, the owner is entitled to what?

Guaranteed surrender value.

Fixed annuities provide all of the following except?

Hedge against inflation.

Which of the following is not true regarding the life with guaranteed minimum annuity settlement option?

It does not guarantee that the entire principle amount will be paid out.

A couple near retirement is planning for their golden years. They want to make sure their retirement and evenly divides monthly benefits or the rest of their lives. Should one of them die, the other would still like to continue receiving benefits. Which settlement option should they choose?

Joint and survivor.

Which of the following is true regarding a waiver of a surrender charge on an annuity contract?

The charge may be waived if the annuitant is confined to a long-term care facility for at least 30 days.