Chapter 8 Exam: Annuities

Bert purchased an immediate annuity with quarterly payments. When will this annuity start making payments?

3 months after the annuity is bought

Kim has purchased a straight life annuity. What will this type of annuity provide her with?

A periodic income to the annuitant for life

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 Deffered

A husband and wife are receiving annuity payments. When the husband dies, the wife still receives annuity payments for life. What kind of annuity is this?

Joint and Survivor Life Annuity

Terry owns a 20 year life annuity certain and dies before the period of 20 years has elapsed. What happens to any monies left?

Paid to the beneficiary for the rest of the certain period

Kris is receiving annuity payments that has not yet paid an amount which is equal to the purchase price of the annuity. If she were to die, her beneficiary would continue receiving annuity payments until this amount has been reached. What type of annuity is this?

Refund life annuity

K has inherited a large sum of money. K purchases an annuity with this sum on July 1, and starts receiving payments August 1. These payments will continue for as long as she and her spouse lives. Which type of annuity did K purchase?

Single Premium Immediate Joint with Survivor Annuity

John is an annuitant who has surrendered his annuity at age 55. What will he pay?

Tax on the interest earned

The monthly benefit of an Annuity Certain is determined by?

The annuitant's payout period selection

A Variable Annuity has which of the following characteristics?

Underlying equity investments