<p>FIL recently passed away after a long illness. He owned an old annuity (purchased in 1983) in his name only, with MIL as sole beneficiary. MIL is being told that because the annuity was purchased before 1985, that her only option is a lump-sum distribution. Are there other options? Who might be able to provide a definitive answer (because definitive answers are the only kind MIL accepts).</p>
<p>Many annuities are better for the consumer than just 5 years ago.
Companies will have different annuities for different retail outlets, h
Some annuities are being scrutinized for being too good for the consumer and bad for the insurance company. </p>
<p>One of the benefits for an annuity is the death provisions that are purchased at very attractive rates and conditions. SEE your advisor(s).</p>
<p>There are no “rollover” options on death. Its a guaranteed provision. Newer annuities are better anyway.</p>
<p>DW is hamstrung by the fact that we don’t have the annuity contract to read. So we don’t know whether it was funded with cash from a retirement account transfer, or if it was a standard annuity purchase. The insurance company keeps saying “Well if it was purchased in 1985 then you’d have some rollover options, but since it was purchased in 1983, you don’t.” I found some notes online which said Congress passed some new annuity rules in 1982 for implementation on 1/18/1985. But those notes basically say that rules were tightened … which makes us wonder why if the rules were tightened for 1985-on, then why are the rollover options more generous?</p>
<p>Find a salesman with the same company. He/she would be able to access the features and most commonly chosen features of this policy. It is his/her best interest to discover information for your MIL because it could lead to another product sale.</p>
<p>Annuities are sold as “B” shares, so even if MIL wishes to “roll” to another annuity, she would not see a commission unless sold prior to final surrender date. Most annuities are held until annuitization, withdrawals, or death. </p>
<p>We moved some of our retirement funds to annuities because, in case of death, the principal and capital gains are protected in an annuity (small fee) whereas in a MF, the funds are not protected. Do you know of anyone who didn’t lose 40% in 2008 (thanks to everything) in a MF and then worried if they would live long enough to recover? Annuities have very heavy regulations (thanks to state regulations). I didn’t renew my term life because the rates for renewal was higher than the death insurance rate within the annuity.</p>
<p>Agree that it makes sense to speak with a person from the same company as the annuity (supposedly lower commission & more compatible product offering). We are trying to decide what to do about H’s hybrid whole life policy and were also advised to speak with someone from the same firm as the policy for maximum benefit at lowest cost. Currently, we’re thinking about leaving the policy as it is (are getting annual tax-free dividends, it has significant cash value & an OK death benefit). Are being offered high death benefit, no dividends and no cash value.</p>
<p>Before you make any decisions, please have a talk with her accountant. The company should absolutely be able to provide you with a full copy of the policy – if they’re struggling with that, a brief email to your MILs state division of insurance (insurance regulator) should be able to suitably encourage them as long as it is a fixed annuity product. (Which, back then, I would guess it would be.)</p>