An important decision in purchasing an annuity is deciding how you want to be paid. You can select annuity payouts for a set period of time or continue for your lifetime. With some options, a beneficiary can be designated to receive payments upon your death. Here is a review of several of the options.

If you take money out of an annuity, there may be a penalty called a surrender fee or a withdrawal charge. This fee is higher if you withdraw funds within the first years of an annuity contract. The penalty, however, drops gradually each year. Since immediate annuities are purchased to provide income, they usually can’t be “surrendered” and will therefore not be subjected to a fee.

A typical surrender fee schedule could be:

The annuity business, like the insurance industry itself, is very competitive. There are hundreds of insurers and many different types of products available to you. Before buying an annuity, contact your state insurance department to see whether it offers an annuity buyers guide for your state.

There are four important things to consider:

Annuities can be purchased through insurance agents, financial planners, banks and life insurance carriers. However, only life insurance companies issue policies.

Agents

Agents are insurance professionals who are licensed by your state insurance department. Some agents work exclusively for one insurance company, while others represent several.

Unlike a 401(k) or an IRA, there are no limits on the amount that you can invest in an annuity.

Whether you’re considering a deferred or immediate annuity, the amount of money you should consider putting into an annuity depends on:

Annuities can serve many useful purposes.

For more detail on life insurance, you can contact:  
 

• American Council of Life Insurers
  1001 Pennsylvania Avenue
  N.W., Washington, D.C. 20004-2599
  202-624-2000
  www.acli.com

When a loved one passes away, locating a life insurance policy can be a challenging but necessary task. There are some steps you can take to get the information you need.  Here are a few tips to guide your search.

Search the deceased's documents and correspondence.

In many cases, evidence of policy and any relevant information

To begin the claims process:

• Get several copies of the death certificate.
• Call your insurance agent. He or she can help you fill out the necessary forms and act as an intermediary with the insurance company. (Don’t keep life insurance policies in your safe deposit box. In most states, safe deposit boxes are sealed temporarily upon the death of the owner, which can delay the settlement. ) If you don’t have an insurance agent, or don’t know who the deceased's agent was, contact the company directly.

If unexpected expenses come up and you can’t pay your life insurance premium, you should know the possible consequences. The effect depends on the type of policy and coverage you have and the policy terms and conditions.

Term: If you stop paying premiums, your coverage lapses.

Permanent: If you have this type of policy, you will have the following choices: