E. Annuities Flashcards

1
Q

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

A

Annuity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

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

A

Insurance protection

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

True or False

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

A

False

Insurers do take the money from annuitants.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

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.

A

True

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

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

A

rights of ownership

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

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

A

annuitant

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

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 __________ __________.

A

Contingent owner

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

__________ provide life insurance protection. Annuities do not.

A

Endowments

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

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

True or False

A

True

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

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

A

Products

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Annuities are often used as life insurance __________ __________.

A

settlement options

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

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

A

immediate annuity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

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.

A

$100,000

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

__________ are often purchased with a lump sum upon retirement.

A

Single premium immediate annuities (SPIAs)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

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

A

single-premium

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

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

A

flexible-premium