Glossary

A surrender charge is a fee imposed by the carrier when a contract owner withdraws funds from a deferred annuity in excess of the contract's free withdrawal allowance during the surrender period, calculated as a percentage of the amount withdrawn under a schedule that typically declines toward zero over a defined number of years. Why it matters The surrender charge is the structural mechanism that converts a deferred annuity from a liquid asset into a constrained one during the ea

The surrender period is the defined number of years following the issue of a deferred annuity contract during which the surrender charge schedule applies, after which withdrawals are no longer subject to surrender charges. Why it matters The surrender period is the time window over which the contract's conditional liquidity profile applies. It defines when the contract is most constrained, when withdrawal becomes progressively cheaper, and when the contract finally becomes fully l