Annuities Test Questions and Answers Graded A+
Simon has purchased a fixed immediate annuity. Fixed period
His payment amount will be dependent upon Interest only
principal, interest, and the contract's Installment refund
surrender charge Life income - -Life income
death benefit
cash refund
income period - -income period Which type of annuity stops all payments upon
the death of the annuitant?
Life annuity
How do interest earnings accumulate in a Period certain annuity
deferred annuity? Cash refund annuity
On a tax credit basis Joint and survivor annuity - -Life annuity
On a tax-deferred basis
On a tax-free basis
On a taxable basis - -On a tax-deferred Which of these statements regarding the
basis annuitant is CORRECT?
The contract can only be assigned by the
annuitant
Under a non-qualified annuity, interest is taxed The annuitant is the only individual who can
after the surrender the contract
deposits have been made The annuitant must also be the beneficiary
death of the annuitant The annuitant's life expectancy determines the
distribution of payments annuity payments - -The annuitant's life
exclusion ratio has been calculated - - expectancy determines the annuity payments
exclusion ratio has been calculated
(The taxable and non-taxable portions of annuity
payments are determined by the exclusion ratio.) Fixed period settlement options are considered to
be a form of a(n)
cash value loan
Who assumes the investment risk with a fixed variable life policy
annuity contract? annuity
The owner Endowment - -annuity
The annuitant
The insurer
The beneficiary - -The insurer An annuitant dies during the distribution period.
(It is the insurance company that bears the What kind of annuity will return to a beneficiary
investment risk of a fixed annuity. The insurance the difference between the annuity value and the
company guarantees the annuitant's principal as income payments already made?
well as a guaranteed minimum rate of return, Variable annuity
even if the underlying assets underperform the Refund annuity
guaranteed rate.) Rebate annuity
Return annuity - -Refund annuity
Which settlement option pays a stated amount to
an annuitant, but no residual value to a Which of these is NOT considered to be a
beneficiary? purpose of an annuity?
1/3
Simon has purchased a fixed immediate annuity. Fixed period
His payment amount will be dependent upon Interest only
principal, interest, and the contract's Installment refund
surrender charge Life income - -Life income
death benefit
cash refund
income period - -income period Which type of annuity stops all payments upon
the death of the annuitant?
Life annuity
How do interest earnings accumulate in a Period certain annuity
deferred annuity? Cash refund annuity
On a tax credit basis Joint and survivor annuity - -Life annuity
On a tax-deferred basis
On a tax-free basis
On a taxable basis - -On a tax-deferred Which of these statements regarding the
basis annuitant is CORRECT?
The contract can only be assigned by the
annuitant
Under a non-qualified annuity, interest is taxed The annuitant is the only individual who can
after the surrender the contract
deposits have been made The annuitant must also be the beneficiary
death of the annuitant The annuitant's life expectancy determines the
distribution of payments annuity payments - -The annuitant's life
exclusion ratio has been calculated - - expectancy determines the annuity payments
exclusion ratio has been calculated
(The taxable and non-taxable portions of annuity
payments are determined by the exclusion ratio.) Fixed period settlement options are considered to
be a form of a(n)
cash value loan
Who assumes the investment risk with a fixed variable life policy
annuity contract? annuity
The owner Endowment - -annuity
The annuitant
The insurer
The beneficiary - -The insurer An annuitant dies during the distribution period.
(It is the insurance company that bears the What kind of annuity will return to a beneficiary
investment risk of a fixed annuity. The insurance the difference between the annuity value and the
company guarantees the annuitant's principal as income payments already made?
well as a guaranteed minimum rate of return, Variable annuity
even if the underlying assets underperform the Refund annuity
guaranteed rate.) Rebate annuity
Return annuity - -Refund annuity
Which settlement option pays a stated amount to
an annuitant, but no residual value to a Which of these is NOT considered to be a
beneficiary? purpose of an annuity?
1/3
