Variable Annuities

A variable annuity is a contract between you and an insurance company, under which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to you beginning immediately or at some future date. You can choose to invest your purchase payments in a range of investment options, which are typically mutual funds. The value of your account in a variable annuity will vary, depending on the performance of the investment options you have chosen.

Variable annuities also offer many of the features of other types of annuities. These include:

1. Tax-deferred growth of earnings;
2. A death benefit that will pay to your beneficiary the greater of your account value or a guaranteed minimum amount, such as your total purchase payments; and
3. The option of receiving a stream of periodic payments for either a definite period, such as 20 years or an indefinite period, such as your lifetime or the life of your spouse.