Types of annuities

FIXED IMMEDIATE ANNUITY : -pays periodic income payments that are guaranteed and fixed in amount; the first payment is due one payment interval from the date of purchase. -Immediate annuities are typically purchased in a lump sum by people nearing retirement.

FIXED DEFERRED ANNUITY : - Provides periodic income payments at some future date. - If the annuitant dies during the accumulation period prior to retirement, a death benefit is typically paid equal to the sum of the gross premiums paid or the cash value if higher. -The annuitant can receive the funds in a lump sum or have them paid out under one of the payout options. - Can be purchased with a lump sum,or the contract may permit flexible premium payments.

JOINT LIFE ANNUITY : -Is an annuity written on the lives of two or more people, such as husband and wife, or brother and sister. Under a joint life annuity, the income payments terminate when the death of the first covered person dies. -The annuity payments continue until the last annuitant dies. -Some contracts pay the full amount of the original income payments until the last survivor dies. Other plans pay a reduced amount.

L0NGEVITY ANNUITY : - is a single-premium deferred annuity that begins paying benefits only at an advanced age. -The longevity annuities are lowcost annuities because there are no cash values or death benefits in the policy.

EQUITY-INDEXED ANNUITY: is a fixed deferred annuity that allows the annuity owner toparticipate in the growth of the stock market and also provides downside protection against the loss of principal and prior interest earnings if the annuity is held to term.

VARIABLE ANNUITY : pays a lifetime income, but the income payments vary depending on the investment experience