It depends on the type of annuity you have. Deferred Annuities will usually pass on the Actual Account Value to the beneficiaries listed on the policy.
Immediate Annuities usually depend on the option selected upon starting the policy. Some have a fixed number of years that they will continue to pay out to a beneficiary listed on the policy. Others have no period listed and will discontinue all payments upon death of the annuity policy holder.
Make sure to discuss all options with your Agent prior to deciding on a certain annuity.
Licensed Life Agent, Life and Finance/ 50 States, New York
Annuities upon death are designated to the beneficiaries whatever is left in the policy. They are tax deferred and are designed to accumulate cash value. and interest until payout at age 59 1/2.
They are taxed as income when payout but not at pay in. Its better to get the deferred annuity, but in situations depending on need immediate annuities are used.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
An annuity can have two phases. If death occurs during the accumulation phase a basic annuity would pay the total of deposits plus interest earned to a designated beneficiary. If death occurs during the distribution phase, distributions would cease at the death of the annuitant. There are optional riders and distribution programs available to tailor the results.
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Immediate Annuities usually depend on the option selected upon starting the policy. Some have a fixed number of years that they will continue to pay out to a beneficiary listed on the policy. Others have no period listed and will discontinue all payments upon death of the annuity policy holder.
Make sure to discuss all options with your Agent prior to deciding on a certain annuity.
They are taxed as income when payout but not at pay in. Its better to get the deferred annuity, but in situations depending on need immediate annuities are used.