On Oct 20, 8:11*am, beliav...[at]aol.com wrote:

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Agreed.

Here in AL we have "ALDIGA" which guarantees certain life insurance
and annuities up to $300k death benefit and $100k surrender value.
Each state is left to decide it's own coverage levels and
requirements.

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<beliavsky[at]aol.com> wrote in message news:d80a3645-eecf-4381-bf9d-4cec9d2bbcf0[at]a3g2000prm.googlegroups.com...
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The same situation exists in MOST States.
Cal

On Sep 15, 2:21*pm, beliav...[at]aol.com wrote:
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The insurance agent told me that in Pennsylvania, where my father
lives, the CD-type annuity he is investing in is backed up to $300K by
a state insurance fund. The web site http://www.immediateannuities.com/gu...y/guaranty.htm
gives the same number. It looks like the risk to his annuity, which is
being issued by a AAA-rated insurance company and which is well below
the $300K limit, is pretty remote.

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On Sep 18, 5:52*am, "Otis" <n...[at]nonexist.com> wrote:
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Good find. It's too bad that the guarantee limits in some states are
as low as $100,000 with California only guaranteeing 80% coverage.

Fortunately, annuity providers are more financially responsible than
banks, minimizing risk to the annuitants.

If one is going to buy an immediate fixed annuity then:
One should be healthy (e.g. non-smoker, not obese, no chronic disease,
etc.)
Wait until interest rates on treasury bonds are high.
Wait until age 70 to get maximum amortization of annuity for tax
benefit.
Don't buy more annuity than the state guarantee limit from any one
vendor.

Although immediateannuities.com gives current annuity prices, it would
be nice to have a calculator that gives the actuarial value of an
immediate annuity contingent on the interest rate.

Another question is whether IRA, Roth, and 401k funds should be used
to purchase an annuity.

--
Ron

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According to this document:

http://fic.wharton.upenn.edu/fic/papers/06/0614.pdf

when an insurance company liquidates, it isn't the state the annuity was
issued in that counts, it's the state you live in at the time of
liquidation. See the footnotes in table 2.

"Ron Peterson" <ron[at]shell.core.com> wrote in message
news:8bf4056f-45f7-4af6-ac38-6a81068487a2[at]s50g2000hsb.googlegroups.com...
- quote -

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On Sep 17, 7:53*am, beliav...[at]aol.com wrote:

- quote -

IIRC, annuities are regulated by the state that they were issued in.
There may be maximum annuity that is guaranteed by the state.

--
Ron

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On Sep 16, 2:40*pm, kastnna <kast...[at]auburnalum.org> wrote:
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I mean this.

<snip> Regardless, I took a look at a handful of single premium fixed
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Thanks for this information.

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I will find out.

AIG, a big insurance company that offers annuities, among other
things, has effectively been taken over by the Federal government to
avoid bankruptcy. I have read that owners of annuities and life
insurance policies should be safe. AIG has insurance subsidiaries that
are strictly regulated. How much credit risk a fixed and immediate
annuties have remains murky to me.

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On Sep 15, 1:21*pm, beliav...[at]aol.com wrote:
- quote -

I'm a little confused of your use of the word "mature". Do you mean
that the annuity has a guaranteed rate of interest for a specified
time period and that time period is almost up? Or perhaps, the annuity
had a surrender period that will soon be expired and thus you parents
can move investments without penalty? Or do you truly mean "matured"
as in the annuity value will be paid out like it or not? Typically
fixed annuities function with both a guaranteed interest period and a
surrender period.

Regardless, I took a look at a handful of single premium fixed
annuities matrices and found a few respectable one's that offered 6+%
guaranteed for 6 years with a 4.55% minimum interest rate after that
period (Jackson National, Lincoln Benefit, MetLife & NY Life, namely).
Honestly, I didn't look into the details/caveats, so make sure you
perform your due diligence. Strangely enough, most of the attractive
offers were 3,6, & 7 year guarantees. 5 yr looked the worst. I don't
know why, but it was the case none the less.

Lastly, assuming the current annuity isn't automatically distributed,
does it have a minimum interest rate floor and, if so, what is it?

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About 10% of the savings of my parents is in a fixed (CD-like) annuity
of a large AAA rated insurance company that will soon mature. On
September 5, the agent quoted them a rate of 4.75% to roll that money
into a new 5-year annuity. This annuity is tax-deferred, but it is not
covered by FDIC, although there are state funds that back annuities.
What spread over FDIC-insured bank certificates of deposit should one
demand to invest in a CD-like annuity?

There is no cut-and-dried answer, just wondering what people would
think represent fair compensation for the slight increase in credit
risk. The annuity benefits from deferral of tax on the interest.

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