Subtopics: Annuity purpose, Accumulation vs annuitization, Fixed annuity, Variable annuity, Life with period certain, Immediate annuity, Annuity best interest, Annuity training, Annuity records, Annuity disclosure, Purpose, Accumulation period, Annuitant, Deferred annuity, Variable annuity licensing, Equity indexed annuity, Pure life option, Refund annuity, Joint and survivor, Annuity certain, Tax-deferred growth, Exclusion ratio, Surrender charge, Retirement income use, Structured settlement, Owner rights, Early withdrawal penalty, Annuity vs life insurance, Single vs flexible premium annuity, Annuity surrender charge period, Bailout provision, Market value adjustment, Annuitization vs surrender, Annuity death benefit, Free withdrawal provision, Cash refund vs installment refund, Joint life annuity, 1035 exchange, Qualified annuity funding, Accumulation vs annuity units, Assumed interest rate, Guaranteed minimum income benefit, Guaranteed minimum withdrawal benefit, Qualified longevity annuity contract, Split-annuity concept, Annuity suitability standard, Nonqualified withdrawal taxation, Owner's death before annuitization, Two-tier annuity, Annuity guaranteed minimum value, Annuity exclusion ratio, Annuity parties, Annuitant requirement, Annuity insurer guarantees, Annuity mortality, SPIA, Deferred annuity funding, Nursing home waiver, Bonus annuity, Indexed annuity cap, Indexed annuity spread, Indexed annuity participation, Annual reset, Point to point, High water mark, Indexed annuity regulation, Variable annuity units, AIR performance, GMDB, Variable annuity seller, Life with refund vs pure life, Joint and survivor variations, Smallest payout option, Annuity certain use, Education funding, Tax-sheltered annuity users, Group annuity, Annuity disclosure free look, Suitability review, Senior annuity concerns, Annuity death before annuitization, Spousal continuation, Non-natural owner, Annuity owner control, Annuity free look
Read the Annuities study guide
Sample questions & answers
1. The primary purpose of an annuity is to:
Liquidate a sum of money into a stream of income
An annuity is designed to systematically liquidate a principal sum, providing income that the annuitant cannot outlive under a life option.
2. During the accumulation phase of a deferred annuity:
The contract is being funded and earnings grow tax-deferred
In the accumulation phase, premiums are paid in and earnings accumulate tax-deferred until the payout (annuitization) phase begins.
3. A fixed annuity guarantees:
A minimum interest rate and fixed income payments
A fixed annuity guarantees a minimum interest rate during accumulation and fixed-dollar payments during the payout phase.
4. In a variable annuity, the contract owner bears:
The investment risk because values depend on separate account performance
In a variable annuity, the owner assumes the investment risk since values fluctuate with the separate account subaccounts.
Practice: Annuities
Answer choices are shuffled every time, and every question comes with an explanation.
Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.
