Shared Flashcard Set

Details

Series 6
Variable Contracts and Retirement Plans
15
Finance
Professional
12/04/2004

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Cards

Term
1) The securities held in the account
2) Policies for transferring between different investment selections
3) Sales charges and other expenses.
Definition
The prospectus of a separate account in a variable contract must include what material information?
Term
Payments made by the issuer to a annuitant vary in dollar amount in accordance with the performance of the separate account.
Definition
What are variable annuity contracts?
Term
Payments
Fixed - Provides fixed payments of specified amount ofr the contract term
Variable - Provides variable dollar payments at regular interval for the contract term.
Rate of Return
Fixed - Guarantees a minimum rate of return
Variable - Provides
Definition
What are the differences between fixed and variable annuities in regard to payments, rate or return, and risk?
Term
1) Tax-Deferred Accumulation
2) Voting Rights
3) Settlement Options
3a) Straight-Life Annuity
3b) Life annuity with period certain
3c) Unit refund life annuity
3d) Joint and last survivor life annuity
3e) Installments for a designated amount
3f) C
Definition
What are some features that may be found in annuity contracts?
Term
1) Calculate the annuitant's interest in the separate account
2) Calculate the first monthly payment
3) Calculate the value of future payments.
Definition
By what method may accumulation units be converted into annuity units?
Term
Term covers a specificed period of time and provides only a death benefit. Permanent provides a death benefit and an accumulation of cash value.
Definition
What is the primary difference between term life insurance and permanent life insurance policies?
Term
1) Interest Option
2) Fixed-period Option
3) Fixed-amount Option
4) Life income option
4a) Straight life
4b) Cash refund
4c) Life income with period certain
4d) Joint and last survivor income
Definition
What are the various settlement options of a variable life insurance contract?
Term
1) Maximum sales charge - 9% computed over a period of up to 20 years
2) Maximum sales charge - 50% of the premium paid during the 1st year of the policy
3) If a policy owner surrenders a variable life policy during the first two policy years, the owner
Definition
What sales charges are allowable on a variable life insurance policy?
Term
Lesser of 100% of annual compensation or
3000 for 2002 - 2004
4000 for 2005 - 2007
5000 for 2008
Definition
With an individual retirement account (IRA) what is the maximum amount an individual may contribute annually?
Term
10
Definition
What are the differences between a Traditional IRA and a Roth IRA?
Term
1) Funds can be used within 120 days to pay qualified acquisition costs for the purchase of a first home.
2) Funds can be withdrawn for certain educational expenses - without the 10% early withdrawal tax.
Definition
When may an early withdrawal from a Traditional IRA be made penalty free?
Term
1) Profit-Sharing Plans
2) 401K Plans
2a) Employee Pays all Plans
2b) Matching Contribution Plans
3) 403(b) - Tax-Deferred Annuity Plans
Definition
What are common types of defined contribution plans?
Term
13
Definition
An individual may transfer or rollover the assets in an IRA or qualified plan without incurring a tax liability under what conditions?
Term
14
Definition
What are some of the ERISA standards that a qualified retirement plan must meet to be eligible for favorable tax treatment?
Term
15
Definition
What are the general participation rules of qualified retirement plans for employees?
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