Defined terms for the annuity market and lifetime income landscape.
A variable annuity is an insurance contract under which the contract owner allocates premium to subaccounts holding investments whose values fluctuate with market performance, with optional living-benefit and death-benefit riders providing contractual guarantees in exchange for explicit charges.
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.
Variance is a measure of how much the individual values in a data set differ from their average, computed as the average of the squared deviations from the mean and expressed in squared units of the data.
