QUESTION 6

1. An immediate annuity is an annuity contract in which payments start within 12 months of the date of purchase. The immediate annuity is purchased with a single premium and periodic payments are generally equal and made monthly, quarterly, semi-annually or annually.

   True

   False

5.55555 points

QUESTION 7

1. Annuity contracts are designed with many different features. It is sensible to plan out the timing, certainty and magnitude of annuity payments for the contracts you are considering across different scenarios. These scenarios should include the annuitants death taking place at different times.

   True

   False

5.55555 points

QUESTION 8

1. If you are concerned with the risk of outliving your financial resources, then you might consider purchasing an immediate annuity at least in an amount sufficient to cover your basic living expenses.

   True

   False

5.55555 points

QUESTION 9

1. Immediate annuity contracts will only pay the annuitant. There are no exceptions. This means that upon the annuitants death the contract is terminated and the insurance company that issued the annuity has no more obligations.

   True

   False

5.55555 points

QUESTION 10

1. It is not required by law than an annuity has a cost-of-living adjustment to keep pace with inflation. It is often possible to buy a annuity that does offer protection from inflation but this annuity will cost more than it would without inflation protection.

   True

   False