Defined terms for the annuity market and lifetime income landscape.
An insurance guarantee fund is the pooled assessment mechanism through which a state guaranty association funds its coverage obligations to contract owners of insolvent insurers, capitalized on a post-assessment basis by mandatory contributions from the solvent insurers licensed in the state.
A joint and survivor annuity is a payout structure in which the insurer makes scheduled income payments for the lifetime of two designated annuitants — typically spouses — with payments continuing in full or at a contractually reduced level after the first annuitant's death.
Lapse of an annuity contract is the termination of the contract before its intended term or annuitization date, typically through the owner's decision to surrender the contract for its surrender value, though the term can also apply to contracts terminated for non-payment of premium.
A life with period certain annuity is a payment structure that pays income for the contract owner's lifetime, with a guaranteed minimum payment period during which payments continue to a named beneficiary if the contract owner dies before the period ends.
A life-only annuity is a payout structure in which the insurer makes scheduled income payments for the lifetime of the contract owner (or other designated annuitant) and the payment obligation ends at death, with no continuation to a survivor and no return of any remaining premium.
