Annuities Part 1 FINAL EXAM (CT 109885)

What do fixed annuities offer?

1. A guaranteed interest rate for a set period of time

What is the agent's role during an annuity transaction?

1. Selecting a company and a product and facilitating between the owner, annuitant, and insurance company

Which of the following describes the role of the annuitant?

1. The individual on whose life the annuity is based

What is true of all annuity policy contracts?

1. They all agree to pay the insured a regular income over a period of years.

Surrender charges are typically used for which kinds of withdrawals?

1. Withdrawals that exceed the free withdrawal privilege.

Which type of investor would be most comfortable with a self-directed variable annuity contract?

2. An investor with a great deal of investment experience that wants to select various investment sub-accounts with different goals

Which of the follow is not a way to describe how the insured will receive annuity income payments?

2. Annuity unknown annuity

Who developed the market value adjustment (MVA) to adjust yields when interest rates were changing rapidly?

2. Insurers

Which of the following describes the person or trustee with investment control over the annuity contract?

2. The annuity owner

Which of the following describes the person, persons, or trust that receives the annuity in the event of the death of the annuitant?

2. The beneficiary

What is the term "annuity" used to describe, besides the contract itself?

2. The income that the individual receives under the contract.

Do variable annuity contracts typically have charges and fees?

2. Yes, each variable annuity contract has its own schedule of fees that should be considered.

Which of the follow is an example of a waiver found in an annuity contract?

3. All listed answers are correct

In a variable annuity contract, the insurer agrees to make periodic payments when?

3. Either immediately, or at some future, pre-decided, date.

Single premiums are more likely to be associated with which annuity type?

3. Fixed annuities

Which of the following is not a part of structuring an annuity correctly?

3. Minimizing payout options

In the opinion of this lesson, which party involved with the annuity transaction is most responsible for discovering the solvency of insurers?

3. The agent

In owner-driven annuity contracts, benefits are based on which of the following happening?

3. The annuity owner's death, disability, or the owner reaching a certain age.

How have annuities maintained an advantage over other forms of investing?

3. The interest earned is tax deferred.

What are the risks associated with variable annuities?

4. Both the solvency of the insurance company and the investment's fluctuating nature

Which of the following is not a form of the life income option that was discussed in this course?

4. Indexed option

For the purpose of equity indexed annuity contracts, using an index's average value instead of its value on specific dates is known as what?

4. Monthly averaging

Do most fixed rate annuities have any associated fees?

4. Other than surrender charges, most fixed rate annuities have no associated charges or fees.

Which of the following is not a settlement option?

Variable

Which of the following is not an example of a fixed rate annuity contract?

all