DC DC Annuities and Retirement Insurance Products

Question 1

A DC resident purchases an annuity that begins making income payments immediately after a lump-sum premium is paid. This is called a(n):

Accepted Answer

Immediate annuity

Answer

Deferred annuity

Answer

Variable annuity

Answer

Indexed annuity

Question 2

Under DC insurance regulations, annuity contracts sold by insurers must include a free-look period of at least:

Accepted Answer

10 days

Answer

20 days

Answer

30 days

Answer

5 days

Question 3

A DC variable annuity's 'separate account' is best described as:

Accepted Answer

An investment account where the premium is invested in sub-accounts such as mutual fund-like portfolios, with returns tied to market performance

Answer

An account held by the state insurance guaranty fund

Answer

A savings account that guarantees principal

Answer

A trust account managed by the DC Insurance Commissioner

Question 4

In DC, an annuity agent selling variable annuity products is required to hold which type of license in addition to a life insurance license?

Accepted Answer

A FINRA securities license (Series 6 or 7) and applicable state variable products license

Answer

Only a DC life insurance license

Answer

A property and casualty license

Answer

A surplus lines broker license

Question 5

A DC fixed annuity contract guarantees the contract owner:

Accepted Answer

A minimum guaranteed interest rate and principal protection

Answer

Returns tied to a stock market index

Answer

The highest possible investment return each year

Answer

Unlimited upside based on market gains

Question 6

DC insurance suitability rules for annuity sales require agents to:

Accepted Answer

Determine that the annuity is appropriate for the customer's financial situation, needs, and objectives before recommending it

Answer

Only sell annuities to clients over age 70

Answer

Provide a 60-day money-back guarantee on all annuity sales

Answer

File each annuity sale with the DISB within 10 days