Question

1. Jade turned 65 yesterday and purchased a joint and survivorship annuity (with her husband) immediate life annuity with the following two features:
   1. 10-year period certain
   2. Variable life/inflation guard

You're the couple’s financial/insurance advisor, explain feature (a) (10-year period certain) and feature (b) (variable life/inflation guard) to the couple so they can understand these features they're getting

Answer 1

Ques.

1. Jade turned 65 yesterday and purchased a joint and survivorship annuity (with her husband) immediate life annuity with the following two features:
   1. 10-year period certain
   2. Variable life/inflation guard

You're the couple’s financial/insurance advisor, explain feature (a) (10-year period certain) and feature (b) (variable life/inflation guard) to the couple so they can understand these features they're getting

Ans. First feature is 10 year period certain. This means that joint and survivorship annuity will pay for atleast 10 years of period to the surviving person among husband and wife. This feature ensure continuous benefit to the surviving person in terms of money for 10 years of his or her life. So, this features provides security for remaining perspective life of a person in terms of money, which is biggest need in any individual's life.

Second feature is Variable life/inflation guard. This will ensure that person receives money and along with that he/she is also compensated for inflation effect in economy. So, this feature will ensure that person is paid in real terms and his spending power does not decrease with passage of time. Variable life will ensure that both husband and wife will receive payment after certain period of time if both of them are alive.