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Flashcards in E. Annuities Deck (16):
1

A contract that will pay a specified indemnity to its owner over a period of time is an __________.

Annuity

2

Annuity tables are different than mortality tables since there is no __________ __________.

Insurance protection

3

True or False

Insurers don't take the money from annuitants who die too soon and pay it to those who live too long.

False

Insurers do take the money from annuitants.

4

True or False

If an insured dies during the accumulation period of an annuity, the account value will be paid to the insured's beneficiary, who is responsible for taxes on interest earned.

True

5

The __________ _____ __________ on an annuity become effective as of the contract date.

rights of ownership

6

The __________ is the party whose life the benefits are based upon.

annuitant

7

Although annuity benefits paid to a beneficiary are usually taxable upon the death of the owner/ annuitant, beneficiaries who are spouses may continue the contract on a tax deferred basis as the __________ __________.

Contingent owner

8

__________ provide life insurance protection. Annuities do not.

Endowments

9

Annuities are opposite of life insurance. Life insurance creates an estate. Annuities systematically liquidates an estate over a period of time.

True or False

True

10

All annuities are insurance __________, although often sold by bankers with Life insurance licenses.

Products

11

Annuities are often used as life insurance __________ __________.

settlement options

12

An __________ __________ begins paying out immediately after the initial premium is paid.

immediate annuity

13

The premium for a $100,000 immediate annuity is __________, regardless of the annuitant's age, health, or gender. It is a payout that depends on these factors.

$100,000

14

__________ are often purchased with a lump sum upon retirement.

Single premium immediate annuities (SPIAs)

15

In order to be considered a __________ __________ deferred annuity, there must be a period longer than one benefit payment interval before payments begin.

single-premium

16

A __________ __________ fixed deferred annuity has a flexible premium, minimum guaranteed rate of return, and a death benefit equal to its cash value.

flexible-premium