Income Intermediate: Variable Annuities

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
The earnings on variable annuities are taxed during the accumulation period.
Choose wisely. There is only one correct answer.
False. The earnings on variable annuities are tax-deferred until payout.
2.
An annuity that pays you income as long as you live, but stops when you die, is a ________.
Choose wisely. There is only one correct answer.
Life annuity. Life annuities pay the annuitant a regular income as long as he or she lives.
3.
With annuities, mortality risk benefits _______.
Choose wisely. There is only one correct answer.
Both. Annuitants trade the risk of dying before collecting full value for higher payments and possibly collecting more than full value if they live long.
4.
Which of the following is not a characteristic investment account available with variable annuities?
Choose wisely. There is only one correct answer.
General account. Stock, bond, and money market accounts are the "characteristic" separate accounts available with variable annuities.
5.
A period certain annuity pays income _______.
Choose wisely. There is only one correct answer.
For a fixed term. A period certain annuity pays income for a fixed term, even if the annuitant doesnt survive the term.