Annuity

An annuitant is guaranteed to NOT outlive their benefits will a(n)

Guaranteed lifetime withdrawal benefit

Fixed annuities provide each of the following EXCEPT

Hedge against inflation

Which of the following is an annuity that is linked to a market-related index?

Equity-indexed annuity

A taxable portion of each annuity payment is calculated using which method?

Exclusion ratio

How soon can the benefit payments begin with a deferred annuity?

A minimum of 12 months after date of purchase

Which of these is NOT considered to be a purpose of an annuity?

Annuities are intended to create an estate

Fixed period settlement options are considered to be a form of a(n)

On a tax-deferred basis

Which type of annuity stops all payments upon the death of the annuitant?

Life annuity

Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?

Life income

Which annuity payout option allows the policy owner to choose a pre-determined number of benefit payments?

Period certain

An annuity is primarily used to provide

Retirement income

Which market index is normally associated with an indexed annuity's rate of return?

S & P 500

What will the beneficiary receive if an annuitant dies during the accumulation period?

The greater the accumulated cash value or the total premium paid

If the annuitant dies before the annuity state date,

The premiums paid plus interest earned will be given to the beneficiary

Andy the annuitant dies before the annuity start date. Which of the following is a TRUE statement?

Premiums paid plus interest earned is returned to the beneficiary

An immediate annuity has been purchased with a single premium. When does the annuitant typically begin receiving benefit payments?

1 month

Under a non-qualified annuity, interest is taxed after the

Exclusion ratio has been calculated

Which of these annuities require premium payments that vary from year to year?

Flexible premium deferred annuity

What happens to interest earned if the annuitant dies before the payout start date?

It is taxable

Which of the following annuity payout options makes no additional payments regardless of when the annuitant dies?

Life only

What is the primary reason for buying an annuity?

Provide future economic security

Kathy's annuity is currently experiencing tax-deferred growth until she retires. Which phase is this annuity in?

Temporary annuity certain

Which of these statements regarding the annuitant is CORRECT?

The annuitant's life expectancy determines the annuity payments