Chapter 5

Ace your homework & exams now with Quizwiz!

Which of the following will NOT be an appropriate use of a deferred annuity?

Creating an estate

According to the nonforfeiture law, if the owner decides to surrender a deferred annuity prior to annuitization, the owner is entitled to which of the following?

Guaranteed surrender value

Which of the following ultimately determines the interest rates paid to the owner of a fixed annuity?

Insurer's guaranteed minimum rate of interest

A couple receives a set amount of income from their annuity. When the wife dies, the husband no longer receives annuity payments. What type of annuity did the couple buy?

Joint Life

If a contract provides a set amount of income for two or more persons with the income stopping upon the first death of the insured, it is called a

Joint life annuity

The president of a company is starting an annuity and decides that his corporation will be the annuitant. Which of the following statements is true?

The annuitant must be a natural person

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 policyholders?

2.5%

Which of the following is TRUE regarding the annuity period?

It may last for the lifetime of the annuitant

Annuity contracts grow tax deferred. That means that

There is no current income taxation upon the growth in the annuity.

If the annuitant dies during the accumulation period, who will receive the annuity benefits?

beneficiary

What license or licenses are required to sell variable annuities?

both a life insurance license and a securities license

Which of the following statements regarding annuities is correct?

Annuities provide income that the annuitant cannot outlive

Which of the following provisions in annuity contracts allow the owner to surrender the annuity if interest rates drop to a specified level?

Bail-out

A couple near retirement is planning for their golden years. They want to make sure that their retirement annuity provides monthly benefits for 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


Related study sets

Unit 10: Energy in the Earth System

View Set

CHA Ch3 Practice Cyber Incident Response

View Set

Eriko, istorijos datos+lietuvos prezidentai

View Set

Vocabulario de el Principe y el Mendigo.

View Set