Connecticut Life Producer Practice exam

Who retains all rights in an annuity contract?

1. The beneficiary of the annuity

2. The insurance company

3. The owner of the annuity

4. The state department of insurance

The correct answer is: The owner of the annuity

In an annuity contract, the owner of the annuity retains all rights associated with that contract. This includes the ability to make changes to the beneficiary designations, transfer the contract, withdraw funds, or even surrender the annuity for cash value if applicable. The owner typically has control over the decisions related to the annuity, while the insurance company acts as the issuer of the contract and manages the funds. The beneficiary may receive benefits from the annuity upon the death of the owner, but they do not have rights to make changes or control the annuity during the owner's lifetime. The insurance company's role is limited to honoring the terms of the contract and fulfilling its obligations, while the state department of insurance regulates the industry and ensures compliance with laws, but does not hold rights to individual contracts. Therefore, the owner of the annuity is the one who holds all the rights within the contract.