Variable annuity fees
·
Death benefit-has an impact on cost
·
Length of time annuity must be held-has an impact
on cost
·
Sales charges <8.5% of total payments, paid
for with accumulation units in separate account
·
Insurance co. pays broker/dealer commission for
selling variable annuity
·
Insurance co. gets spent $ back through separate
account fees
·
Level load sales charges, annuitant pays sales
charges over the time the $ is invested in annuity
·
Contingent deferred sales charge, penalty charge
for ending variable annuity contract early
·
Sales charge period, needs to expire for
customers to end contract without penalty
·
Front end sales charge, can’t be>8.5%,
investment $ - sales charge is placed in separate account
Variable annuity
·
Security
·
Insurance product
·
Must be registered
·
RR must be licensed in state of sale
Variable annuity contract
·
Security
·
Register with SEC
·
Separate account-register as security
·
Investment Company Act of 1940-separate account must
register
·
RR must have Series7 or Series6
The people who sell variable annuities must be registered
with which of the following:
·
The state-salesman
·
FINRA-salesman
·
Separate account: state & SEC
