MICHIGAN VARIABLE NEWLY UPDATED COLLECTION OF EXAM QUESTIONS AND
VERIFIED ANSWERS DESIGNED TO GUARANTEE YOUR SUCCESS ON THE LATEST
TEST VERSION
Additional terms for pure life settlement are ANSWER and life income.
-life insurance
Which annuity settlement choice yields the highest lifetime guaranteed monthly
income? The option for a pure life settlement
The insurer promises to continue paying an annuity to a designated beneficiary
for the remainder of the specified period even if the annuitant dies within that
time frame. This is the second life contingency option, ANSWER life with
period certain (i.e., 10 years).
The third life contingency option is ANSWER life with refund, wherein the
insurer commits to paying out the remaining basis to a designated beneficiary if
the annuitant passes away before the payments received match the annuitant's
basis (the whole amount paid for the annuity).
Which choice for an annuity settlement offers the highest monthly income
payment?
an. life with a specific time frame
b. option for pure life
c. ANSWER b: "life with refund"
How long is the free-look period for Michigan annuity contracts? ANSWER: 10
calendar days from the date of purchase (during which the premium paid will be
fully refunded).
accumulation period/units: 1,000 accumulation units would be purchased with a
$5,000 premium deposit in a VA where the units are worth $5. Keep in mind
that both the quantity and value of accumulation units fluctuate. New premium
PMTs alter the quantity of accumulation units in a buyer's account, and market
swings alter the value of each unit.
, Annuity period/units: ANSWER When annuitized, accumulation units are
converted to a certain number of annuity units, which is one of the factors used
to determine the monthly payout during the annuity phase (the value of each
unit changes once the number of annuity units is chosen, but it will not change).
Assumed Interest Rate (AIR): VA owners must experience a separate account
net investment rate of return that surpasses the AIR in order for those product
values to increase. AIR is an arbitrary rate of return imposed by the insurer for
any separate account they establish.
When applying AIR to variable life, the variable death benefit is covered by
ANSWER, but not var. cash value (the variable insurance death benefit would
only be increased by a separate account return over the AIR).
Applying AIR to variable annuity: ANSWER only applies to the variable
annuity unit value and any payouts; it does not apply to the variable
accumulation value. The only way to raise the variable annuity unit values and
PMTs would be to submit a separate account return over the AIR.
Combination Annuities: ANSWER Combo provides both fixed and variable
contract features.
-A fixed part provides a rate guarantee.
-The variable component seeks to increase the rate of return.
For prudent investing, -$ in the fixed portion goes to the general account.
-$ in the variable element goes to a different account for mutual funds, equities,
and bonds.
-Reps need to be licensed in securities and insurance.
Guaranteed Living Benefits (GLB): ANSWER Annuities' features that
guarantee income, accumulation, and withdrawal make them appealing to older
and more cautious customers.
The ANSWER variable annuity guaranteed life benefit's guaranteed minimum
account value (GMAV) guarantees that the contract's account value will be the
higher of the premiums paid or the actual account value after a predetermined
amount of time, like eight or ten years.
A minimum amount will always be available to convert to annuitized income at
the pace stated in the contract thanks to the ANSWER variable annuity
guaranteed life benefit.
guaranteed minimum income payments: ANSWER guarantees that the
annuitant will get at least a certain percentage of the initial payment for each
VERIFIED ANSWERS DESIGNED TO GUARANTEE YOUR SUCCESS ON THE LATEST
TEST VERSION
Additional terms for pure life settlement are ANSWER and life income.
-life insurance
Which annuity settlement choice yields the highest lifetime guaranteed monthly
income? The option for a pure life settlement
The insurer promises to continue paying an annuity to a designated beneficiary
for the remainder of the specified period even if the annuitant dies within that
time frame. This is the second life contingency option, ANSWER life with
period certain (i.e., 10 years).
The third life contingency option is ANSWER life with refund, wherein the
insurer commits to paying out the remaining basis to a designated beneficiary if
the annuitant passes away before the payments received match the annuitant's
basis (the whole amount paid for the annuity).
Which choice for an annuity settlement offers the highest monthly income
payment?
an. life with a specific time frame
b. option for pure life
c. ANSWER b: "life with refund"
How long is the free-look period for Michigan annuity contracts? ANSWER: 10
calendar days from the date of purchase (during which the premium paid will be
fully refunded).
accumulation period/units: 1,000 accumulation units would be purchased with a
$5,000 premium deposit in a VA where the units are worth $5. Keep in mind
that both the quantity and value of accumulation units fluctuate. New premium
PMTs alter the quantity of accumulation units in a buyer's account, and market
swings alter the value of each unit.
, Annuity period/units: ANSWER When annuitized, accumulation units are
converted to a certain number of annuity units, which is one of the factors used
to determine the monthly payout during the annuity phase (the value of each
unit changes once the number of annuity units is chosen, but it will not change).
Assumed Interest Rate (AIR): VA owners must experience a separate account
net investment rate of return that surpasses the AIR in order for those product
values to increase. AIR is an arbitrary rate of return imposed by the insurer for
any separate account they establish.
When applying AIR to variable life, the variable death benefit is covered by
ANSWER, but not var. cash value (the variable insurance death benefit would
only be increased by a separate account return over the AIR).
Applying AIR to variable annuity: ANSWER only applies to the variable
annuity unit value and any payouts; it does not apply to the variable
accumulation value. The only way to raise the variable annuity unit values and
PMTs would be to submit a separate account return over the AIR.
Combination Annuities: ANSWER Combo provides both fixed and variable
contract features.
-A fixed part provides a rate guarantee.
-The variable component seeks to increase the rate of return.
For prudent investing, -$ in the fixed portion goes to the general account.
-$ in the variable element goes to a different account for mutual funds, equities,
and bonds.
-Reps need to be licensed in securities and insurance.
Guaranteed Living Benefits (GLB): ANSWER Annuities' features that
guarantee income, accumulation, and withdrawal make them appealing to older
and more cautious customers.
The ANSWER variable annuity guaranteed life benefit's guaranteed minimum
account value (GMAV) guarantees that the contract's account value will be the
higher of the premiums paid or the actual account value after a predetermined
amount of time, like eight or ten years.
A minimum amount will always be available to convert to annuitized income at
the pace stated in the contract thanks to the ANSWER variable annuity
guaranteed life benefit.
guaranteed minimum income payments: ANSWER guarantees that the
annuitant will get at least a certain percentage of the initial payment for each
