When Are Annuity Units Determined?

  1. 63333 POINTS
    Peggy Mace
    Most of the U.S.
    Annuity units are determined after the accumulation phase of the annuity and before the annuitization phase. When the contract becomes annuitized, the accumulation units become annuity units. An actuarial formula is used that takes into account age, sex, payout rate, and assumed interest rate. The number of annuity units and value of each unit is determined at this time, right before starting the annuity payouts.
    Answered on May 18, 2013
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