NAIC 390 Final Exam 2023 with complete solution
Regarding indexed annuities, the participation rate is best described as:
The percentage of increase in the index that will be used to calculate the index-linked interest rate.
Mortality and expense risk charges are designed to offset the insurer...
naic 390 final exam 2023 with complete solution regarding indexed annuities
the participation rate is best described as the percentage of increase in the index that will be used to calculate the in
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NAIC 390 Final Exam 2023 with complete solution
Regarding indexed annuities, the participation rate is best described as:
The percentage of increase in the index that will be used to calculate the index-linked
interest rate.
Mortality and expense risk charges are designed to offset the insurer's risk that
the annuitant will outlive his or her
Life expectancy.
By creating a shared-risk pool, a fixed annuity evens out the ______ of the
participants.
Mortality risk.
Kate chooses a payment option that will guarantee payments for her lifetime but
with an additional guarantee that payments will be made for at least 10 years
should she die before then. This is referred to as a(n) ___________ payout.
Life with period-certain.
Variable annuities offer investment options through a variety of ___________ that
have a range of investment objectives to match consumer's risk tolerances, time
horizons, and goals.
Variable subaccounts.
With this type of variable annuity living-benefit guarantee, the insurer promises a
fixed lifetime payment calculated a hypothetical benefit base even if the contract
performs poorly.
Guaranteed minimum income benefit.
If an annuitant surrenders his or her contract before reaching age 59 1/2, a
____________ premature-distribution tax penalty will apply.
10%
Tax advantages of annuities include __________.
Tax-deferred accumulations.
Starting in the 1970s, issuers began offering _________ insurance products that
offered the potential for greater returns through the inclusion of an investment
component.
Universal life.
In reference to indexed annuities, the terms annual reset, high-water mark, low-
water mark, and point-to-point refer to ____________.
Index methods.
The person designated to receive the death benefit of an annuity is the _______.
If you don't know this, shame on you. Beneficiary.
Brandon owns mutual funds in his IRA and is considering buying a variable
annuity. His agent explains that the "_____________" of the variable subaccounts
are equivalent to the "shares of a mutual fund.
Accumulation units.
Marcy selects a payment option on her annuity that provides for payments to
continue for her lifetime, regardless of how long or short that may be. This is
referred to as a ____________ payout.
Straight life.
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