Answer True or Fasle about Annuties:
1) A variable annuity contract can be defined as a contract in which the insurance company varies the annuity payments based on the net income of the insurance company. If the net income of the insurance company increases, then the annuity payments associated with a variable annuity contract will increase.
2) All annuity contracts have a feature that protects the annuitant from inflation.
3) An immediate annuity is an annuity contract in which payments start within 12 months of the date of purchase. The immediate annuity is purchased with a single premium and periodic payments are generally equal and made monthly, quarterly, semi-annually or annually.
4) Annuity contracts are designed with many different features. It is sensible to plan out the timing, certainty and magnitude of annuity payments for the contracts you are considering across different scenarios. These scenarios should include the annuitant’s death taking place at different times.
5) Variable annuities are a riskier investment than fixed annuities.
6) The goal of most annuities is to provide a steady stream of income during retirement for a specified period of time or for the remainder of one or more lives.
7) One feature that all annuity contracts have in common is that the annuitant can never outline the annuity payments.
8) Immediate annuity contracts will only pay the annuitant. There are no exceptions. This means that upon the annuitant’s death the contract is terminated and the insurance company that issued the annuity has no more obligations.
9) If you are concerned with the risk of outliving your financial resources, then you might consider purchasing an immediate annuity at least in an amount sufficient to cover your basic living expenses.