Which settlement option pays a stated amount to an annuitant?
One such option is the “stated amount” settlement option, which pays an annuitant a stated amount at the end of each year instead of receiving monthly payments. The purpose behind this type of settlement is to provide security and income stability.
Which type of annuity settlements stops when the annuitant dies?
Like all annuities, a straight life annuity provides a guaranteed income stream until the death of the annuity owner. What makes a straight life unique is that, once the annuitant dies, all payments stop and no more money or death benefits are due to the annuitant, their spouse, or heirs.
Which of the following will have the highest monthly payout upon annuitization?
Life Option This option typically provides the highest payout because the monthly payment is calculated only on the life of the annuitant. 1 This option provides an income stream for life, which is an effective hedge against outliving your retirement income.
What method is used to determine the taxable portion of each annuity payment quizlet?
What method is used to determine the taxable portion of each annuity payment? The ratio of the total investment in that contract to the expected return is developed to determine the portion of the annuity payment that will be taxable and nontaxable.
What is a fixed life annuity settlement option?
Annuity Settlement Options - One of the unique features of an annuity is the opportunity to elect a settlement option and set up a dependable stream of income. If a settlement option is elected, Gleaner will make periodic payments to the annuitant.
What are the types of annuity settlement options?
Annuity payout optionsDeath benefit. ... Fixed Amount (also called Systematic Withdrawal Schedule) ... Fixed Period (also called Period Certain) ... Joint and Survivor Life. ... Life Only. ... Life with Period Certain (also called Guaranteed Term) ... Lump Sum Payment.
Which annuity pays the most?
As of July 2022, Canvas Annuity pays the highest interest rates among all annuities with a guaranteed return. It guarantees a 4.6 percent return for three, five, and seven years.
What is annuitization option?
Annuitization is converting your retirement savings into a guaranteed stream of annuity payments for a fixed period of time, the rest of your life, or both.
How do I choose an annuity option?
When choosing an annuity option, you should consider all of your assets such as life insurance, home, investments, savings, etc., to determine what type of survivor protection, if any, is needed. The various annuity options differ after you pass away.
Which annuity payout option allows the policyholder to choose a predetermined number of benefit payments?
Which annuity payout option allows the policy owner to choose a pre-determined number of benefit payments? The period certain payout guarantees payments for a specific number of years, typically 5 to 20 years.
Which settlement option involves having the proceeds?
Which settlement option involves having the proceeds remain with the insurer and earnings paid on a monthly basis to the beneficiary? A Spendthrift Clause is a statement in a settlement agreement that indicates that the proceeds of the policy will be free from attachment or seizure by the beneficiary's creditors.
Which is a type of annuity quizlet?
What are the three primary categories of an annuity? Fixed annuities, equity indexed annuities, and variable annuities.
What happens if the annuitant dies before annuitization?
A: Yes. An annuity contract generally provides that if the annuitant dies before the annuity starting date, the beneficiary will be paid, as a death benefit, the greater of the amount of premium paid or the accumulated value of the contract. The gain, if any, is taxable as ordinary income to the beneficiary.
What will the beneficiary receive if an annuitant dies during the accumulation period quizlet?
if an annuitant dies during the accumulation period, the insurer is obligated to return to the beneficiary either the cash value, or the total premiums paid, whichever is greater.
What will the beneficiary receive if an annuitant dies?
After an annuitant dies, insurance companies distribute any remaining payments to beneficiaries in a lump sum or stream of payments. It's important to include a beneficiary in the annuity contract terms so that the accumulated assets are not surrendered to a financial institution if the owner dies.
What will the beneficiary receive if the annuitant dies during the accumulation?
The beneficiary. If the annuitant dies during the accumulation period, the beneficiary receives benefits from the annuity: either the amount paid into the plan or the cash value - whichever is greater. If a beneficiary is not named, the benefit will be paid to the annuitants estate.