Parties to an Annuity

Question 1

Annuity Owners have what 5 rights?

Answer 1

During the accumulation stage, the annuity contract owner has the right to

1. decide on the annuity starting date, which is the date on which income benefits are scheduled to begin;
2. choose or change the income payout option before start date;
3. name the annuitant and the beneficiary;
4. receive some or all of the cash value in a partial or complete surrender of the contract; and
5. assign the contract.

Question 2

What is the Annuitant and what are Joint Annuitants?

Answer 2

The annuitant is the person upon whose life the annuity payment amount and duration is based.

The owner may name two people as joint annuitants. If two people are named jointly, then their joint life expectancy is the basis for determining the annuity payment amount and duration.

Question 3

Define the 2 ways a annuities contracts are triggered to payout to a Beneficiary?

Answer 3

An annuity’s beneficiary is the person the owner chooses to receive the contract’s values if either the owner or the annuitant dies before annuitization.

annuitant-driven (the annuitant’s death before annuitization triggers payment of the contract value to the beneficiary)

owner-driven (owner’s death before annuitization triggers payment of the contract death benefit)

Question 4