1
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Michigan Variable Annuities Exam
Questions and Answers (100% Correct
Answers) Already Graded A+
Other names for pure life settlement [ ANS: ] -life income
-life annuity
What annuity settlement option produces the largest monthly
income guaranteed for life? [ ANS: ] pure life settlement option
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second life contingency option [ ANS: ] life with period certain
(ie. 10 years) so even if the annuitant does or does not die within
that timeframe, insurer guarantees to continue the annuity
payments to a named beneficiary for the balance of the certain
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period.
third life contingency option [ ANS: ] life with refund; insurer
guarantees payments for life, but if the annuitant dies before the
payments received equal the annuitant's basis (the total amount
paid for the annuity), then the insurer agrees to pay out the
remaining basis to a named beneficiary
which annuity settlement option provides the largest monthly
income payment?
a. life with period certain
b. pure life option
c. life with refund [ ANS: ] b
how long is the free-look period for Michigan annuity contracts [
ANS: ] 10 calendar days after purchase date (eligible for full
refund including premium paid)
, 2
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accumulation period/units [ ANS: ] a $5,000 prem deposit in a VA
in which the units are valued at $5, would purchase 1,000
accumulation units. New prem pmts change the number of
accumulation units in a purchaser's account, and market
fluctuations change each unit's value, so remember that both the
number and value of accumulation units change
annuity period/units [ ANS: ] when annuitized, accumulation units
are converted to a set number of annuity units; this number
becomes one of the factors used to calculate the payout each
month during the annuity phase (once the # of annuity units is
chosen, it will not change, but the value of each unit change)
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Assumed Interest Rate (AIR) [ ANS: ] arbitrary rate of return set by
the insurer for any separate account they establish; VA owner ust
experience a separate account net investment rate of return that
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exceeds the AIR in order for those product values to go up
Applying AIR to variable life [ ANS: ] applies to the variable death
benefit, but not var. cash value (only a separate account return
above the AIR would increase the variable policy death benefit)
Applying AIR to variable annuity [ ANS: ] applies to the variable
annuity unit value and any payouts, but not o the variable
accumulation value (only a separate account return above the
AIR would increase the variable annuity unit values and pmts)
Combination Annuities [ ANS: ] Combo offers features of fixed
and variable contracts
-Fixed portion offers guaranteed rate
-Variable portion tries to achieve higher rate of return
-$ in fixed portion goes to general account for conservative
investment
-$ in variable portion goes to separate account for stocks, bond,
mutual funds
For Expert help and assignment solutions, +254707240657
Michigan Variable Annuities Exam
Questions and Answers (100% Correct
Answers) Already Graded A+
Other names for pure life settlement [ ANS: ] -life income
-life annuity
What annuity settlement option produces the largest monthly
income guaranteed for life? [ ANS: ] pure life settlement option
© 2025 Assignment Expert
second life contingency option [ ANS: ] life with period certain
(ie. 10 years) so even if the annuitant does or does not die within
that timeframe, insurer guarantees to continue the annuity
payments to a named beneficiary for the balance of the certain
Guru01 - Stuvia
period.
third life contingency option [ ANS: ] life with refund; insurer
guarantees payments for life, but if the annuitant dies before the
payments received equal the annuitant's basis (the total amount
paid for the annuity), then the insurer agrees to pay out the
remaining basis to a named beneficiary
which annuity settlement option provides the largest monthly
income payment?
a. life with period certain
b. pure life option
c. life with refund [ ANS: ] b
how long is the free-look period for Michigan annuity contracts [
ANS: ] 10 calendar days after purchase date (eligible for full
refund including premium paid)
, 2
For Expert help and assignment solutions, +254707240657
accumulation period/units [ ANS: ] a $5,000 prem deposit in a VA
in which the units are valued at $5, would purchase 1,000
accumulation units. New prem pmts change the number of
accumulation units in a purchaser's account, and market
fluctuations change each unit's value, so remember that both the
number and value of accumulation units change
annuity period/units [ ANS: ] when annuitized, accumulation units
are converted to a set number of annuity units; this number
becomes one of the factors used to calculate the payout each
month during the annuity phase (once the # of annuity units is
chosen, it will not change, but the value of each unit change)
© 2025 Assignment Expert
Assumed Interest Rate (AIR) [ ANS: ] arbitrary rate of return set by
the insurer for any separate account they establish; VA owner ust
experience a separate account net investment rate of return that
Guru01 - Stuvia
exceeds the AIR in order for those product values to go up
Applying AIR to variable life [ ANS: ] applies to the variable death
benefit, but not var. cash value (only a separate account return
above the AIR would increase the variable policy death benefit)
Applying AIR to variable annuity [ ANS: ] applies to the variable
annuity unit value and any payouts, but not o the variable
accumulation value (only a separate account return above the
AIR would increase the variable annuity unit values and pmts)
Combination Annuities [ ANS: ] Combo offers features of fixed
and variable contracts
-Fixed portion offers guaranteed rate
-Variable portion tries to achieve higher rate of return
-$ in fixed portion goes to general account for conservative
investment
-$ in variable portion goes to separate account for stocks, bond,
mutual funds
