Types of Policies
What characterizes a deferred annuity contract during its accumulation phase?
Answer and explanation
Answer: C. Deferred annuities accumulate earnings tax-deferred for a period before payouts start.Source: NAIC Annuity Buyer's Guide — PDF page 3, Deferred Annuities
More types of policies questions
- An annually renewable term policy is renewed for another year. What happens to the premium and to the evidence of insurability?
- An annuitant wants lifetime income but also wants payments guaranteed for at least 15 years if death occurs early. Which payout basis addresses both goals?
- An annuity buyer wants to select investment subaccounts and accepts that poor performance could reduce contract value below contributions. Which annuity is the direct match?
- An annuity owner wants income payments for as long as the owner lives, without adding a spouse or a minimum payment period. Which payout basis matches that request?
- An equity-indexed policy has an 80% participation rate and a 10% cap. If the underlying index grows by 15% in a policy year, what interest rate is credited?
- An indexed universal life policy's referenced index has a negative result for the crediting period. Which contract feature should the owner examine to determine the lowest credited rate?
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