Annuity

A contract between an insurance company and an individual. It generally guarantees lifetime income to the person on whose life the contract is based in return for either a lump sum or a periodic payment to the insurance company. A fixed annuity guarantees a specific amount of payment each month. In a variable annuity, the amount of the monthly check would fluctuate according to the value of the securities in the separate account.

Updated on: 24/04/2023