Who’s Who in An FIA: Fixed Index Annuities Explained
Retirees can gain a lot by understanding fixed index annuities (FIAs). Simply put, a fixed index annuity (FIA) is a contract between both you and the insurance company. Basically, this agreement goes over the specifics of the annuity insurance product you purchased.
It also confirms the terms of your annuity. These terms include the rights and responsibilities of each party. In addition, it highlights how long the money needs to stay in the annuity to increase and when the money can be paid out.
in an FIA:
There are 4 roles that exist when it comes to annuity contracts, especially when it comes to fixed index annuities (FIAs). It is also important to have an insurance professional on your side that completely understands annuities. Those that included in the annuity process are:
Insurance Company: This is the company that issues the annuity. They are responsible for back the guarantees of the annuity.
Contract Owner: Usually, the contract owner and annuitant are the same person, but sometimes they are different people. The owner is the person who makes decisions about the annuity, like who the beneficiaries are.
Annuitant: The annuitant is the person whose life expectancy is used to calculate the annuity payment. This could be the same person as the contract owner, but in some cases, it may be someone different.
Beneficiary: When you die your beneficiary is the person that receives your death benefit. It’s important to name one or more beneficiaries. That’s because, without one, the money in your annuity is subject to probate. A death benefit can be paid without probate.
There are many options available to you, the retiree,
when it involves annuities.
That’s, why it is important to speak to a professional like the team here at Cornerstone Wealth & Tax Advisory when you need fixed index annuities explained.