Defined terms for the annuity market and lifetime income landscape.
A step-up provision is a rider mechanic that periodically resets the benefit base — or another rider-defined value such as a guaranteed minimum death benefit — to a high-water mark of the contract's account value at specified contract anniversaries, locking in past investment performance.
Stochastic modeling is a way of projecting future outcomes in which one or more inputs are drawn from probability distributions and the model produces a range of results across many simulated paths, rather than a single result.
A straight life annuity is a lifetime income contract paying income for the contract owner's lifetime and stopping at death, with no beneficiary payments and no guaranteed minimum payment period.
Stress testing is an analytical technique that runs a model under adverse input conditions selected to test whether an arrangement or portfolio can withstand specific severe scenarios.
Stretch provisions were the pre-SECURE Act rules that allowed a non-spouse beneficiary of an inherited retirement account or annuity to take required minimum distributions over the beneficiary's own life expectancy, extending tax deferral across the beneficiary's remaining lifetime.
