A good annuity is easy to explain. If an agent can’t answer these questions clearly and in writing, keep looking. Ask them of anyone — including us.
About the product
- What exactly will I receive, and when? Get the monthly amount and start date in writing, on a quote from the insurance company.
- Can I get my money out, and what would it cost? Ask about surrender charges, their length, and free withdrawal amounts.
- What happens to the money if I die? Which guarantee option applies, and who receives what?
- What does it cost, and how is that charged? Many SPIAs and MYGAs have no explicit ongoing account fee — the insurer’s costs and the agent’s commission are built into the payout or interest rate. Ask about surrender charges (MYGAs and FIAs), market value adjustments, and yearly rider fees (common on FIAs).
- Is anything about this not guaranteed? Ask which numbers are guaranteed and which are only illustrated.
About the company
- Which insurance company issues it, and how is it rated? Guarantees depend on the insurer’s claims-paying ability. Look for AM Best ratings; A- or better is a common bar.
- How does this compare with other carriers? Payouts for the same person can differ by several percent. Ask to see more than one quote.
- How long is the quote guaranteed? Ask what happens to the rate if your money arrives after the quote expires.
About the person selling it
- Are you licensed in my state? You can check with your state’s department of insurance.
- How are you paid? Agents are typically paid a commission by the insurance company, built into the product’s pricing rather than billed to you. It’s fair to ask how much, on the specific product. (Here’s how we’re paid.)
- Why is this right for me, and what would you suggest instead? A good agent explains when an annuity is not the answer.
- Is there a free-look period? Most states give you 10–30 days to cancel for a full refund after you receive the contract.
Our promise: we’ll answer every one of these questions for you, in writing, before you decide anything — and we’ll tell you if an annuity isn’t a good fit.
