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A type of annuity that pays the primary account holder payments until death, with no other account holders is known as a life annuity or straight life.
These types of annuities have the fastest payout, but carry risk. While the rate of return and payment may be attractive, the risk is no other person will get the payments after the primary holder dies. The insurance company retains the value.
Most annuity investors will look at life with period certian or rights of last survivorship accounts.
These investment plans can be qualified or non tax qualified. Qualfied meaning that the contributions made into the annuity are tax deferred. A non qualified plan means money invested is with after tax dollars.
If variable, the money is invested into a separate account of actively managed common stock. The rate of return will fluctuate based on the performance of the securities. A fixed life annuity will have a fixed rate of return.
The securities type and asset make up of the accounts can be chosen by the investor or plan custodian. Most insurance and financial services companies have hundreds of different types of accounts where the money can be invested within the equities and/or debt markets for annuities account growth. This can be applied to straight life, joint, and rights of survivorship.
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Copyright  2006 American Investment Training, Inc.
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