Defined terms for the annuity market and lifetime income landscape.
State insurance regulation is the system under which each U.S. state — rather than the federal government — licenses insurance carriers, regulates the annuity and insurance products they sell, monitors their financial condition, and handles carriers in distress.
Tax-deferred growth is the tax treatment under which investment earnings inside an annuity contract accumulate without current federal income tax, with tax deferred until amounts are withdrawn and the previously untaxed earnings are then treated as ordinary income.
Variable annuity as security is the federal regulatory characterization of a variable annuity as an investment contract subject to the Securities Act of 1933 and the Investment Company Act of 1940, based on the contract owner bearing the investment risk on the underlying separate-account assets.
