Annuities (ch. 5)
25 year old wants to take measures now to make sure that after retirement, he will have a good income. What would help to do this?
An annuity
In an annuity, the accumulated money is converted into a stream of income during which time period?
Annuitization period
Annuity owner dies while annuity is still in the accumulation stage.
Beneficiary will receive the greater of the money paid into the annuity or the cash value
What license or licenses are required to sell variable annuities?
Both a life insurance license and a securities license
Under which annuity option does the annuitant select the time period for the benefits and the insurer determines how much each payment will be?
Installments for a fixed period
an annuity owner
Does not have to be the party to receive benefits
True regarding annuity period
It may last for the lifetime of the annuitant
Best describes difference between Pure Life and Life with Guaranteed Minimum settlement options?
Life with Guaranteed Minimum will pay the remaining principal to the beneficiary
Group annuity CANNOT
Owned by individual employees
Another term for the accumulation period of an annuity
Pay-in period
Characteristic an annuity has to have if it is used to accumulate funds in an IRA
Tax qualified
Annuity owner dies and cash value exceeds the premiums he paid. There is no named beneficiary. Which is true?
The cash value will be paid to the annuitant's estate
True regarding a modified guaranteed annuity
The owner is guaranteed a fixed interest rate for a specific period of time
Option for Installments for a fixed amount that Is not true
The payments will stop when the annuitant dies
Which product requires a securities license?
Variable annuity