Usually it is backed by the financial strength of the issuing insuance company.
Answer 2
But more usually government bonds are bought to cover the payments to be made by the insurer. This guarantees (as far as one can guarantee anything) that the annuity payments are safe. The financial strength of the insurer is a very vague measurement - who'd have thought that an insurer like AIG (massive financial strength?) would go under.
How safe is TSA 403 (b) Fixed annuity? Is TSA 403 (b) Fixed annuity insured ?
the insured agrees to make a lum-sum payment or series of payments to an insurance company
An annuity settlement is a financial or insurance arrangement where the insured party receives periodic payments from the accused. The accused may then transfer their periodic payment responsibilities to an organized settlement organization.
It would depend on weather it is an immediate or a differed annuity contract. An immediate annuity would provide guaranteed income for a specified number of years or over the life time of the insured regardless of how long the annuitant lived. A deferred annuity provides for long term tax deferred growth and if its not in a qualified plan the annuity holder is not limited to the amount deposited each year.
ordinary annuity
How safe is TSA 403 (b) Fixed annuity? Is TSA 403 (b) Fixed annuity insured ?
That depends on your particular annuity.
the insured agrees to make a lum-sum payment or series of payments to an insurance company
the insured agrees to make a lump-sum payment or series of payments to an insurance company...
An annuity settlement is a financial or insurance arrangement where the insured party receives periodic payments from the accused. The accused may then transfer their periodic payment responsibilities to an organized settlement organization.
It would depend on weather it is an immediate or a differed annuity contract. An immediate annuity would provide guaranteed income for a specified number of years or over the life time of the insured regardless of how long the annuitant lived. A deferred annuity provides for long term tax deferred growth and if its not in a qualified plan the annuity holder is not limited to the amount deposited each year.
Horace Mann is a private insurance company selling products for profit. Their products are not insured by any government authority.
"In the U.S. an annuity contract is created when an insured party, usually an individual, pays a life insurance company a single premium that will later be distributed back to the insured party over time. Annuity contracts traditionally provide a guaranteed distribution of income over time, until the death of the person or persons named in the contract or until a final date, whichever comes first"
If the annuity is a non qualified tax deferred annuity (an annuity that taxes were paid on the money before they were placed into the annuity) you will pay taxes on any interest growth when it is removed from the annuity. If the annuity is a qualified annuity (no taxes were paid prior to placing the fund into the annuity) you will pay taxes on all withdrawals from the annuity.
In the United States an annuity contract is created when an insured party, usually an individual, pays a life insurance company a single premium that will later be distributed back to the insured party over time. Annuity contracts traditionally provide a guaranteed distribution of income over time, until the death of the person or persons named in the contract or until a final date, whichever comes first. However, the majority of modern annuity customers use annuities only to accumulate funds free of income and capital gains taxes and to later take lump-sum withdrawals without using the guaranteed-income-for-life feature
difference between an annuity and a compound annuity?Read more: What_is_the_primary_difference_between_an_annuity_and_a_compound_annuity
ordinary annuity