Terms for FIA’s (Fixed Index Annuities)
Summary:
This page is for those clients who already own Indexed Annuities and need a reminder about the terms used with them.
FIA: Fixed Index Annuity
Index:
Anniversary Date:
Point to Point:
Starting Point:
Ending Point:
CAP: Is the maximum rate of interest credited to values under a specific indexed strategy.
Floor: This is the lowest rate you can earn in a specific indexed strategy which is usually zero. Which is a real blessing in declining markets.
Participation Rate:
Multi Strategy: There are several buckets (sub accounts if you will) that you allocate you funds into.
Declared Rate Strategy: At your anniversary date you can elect to move part or all of your money to a bucket call “Declared Rate Strategy” a published rate good for one year offered on your renewal letter.
Monthly Cap Strategy: Strategy that earns interest on an annual basis by comparing the monthly changes in the S&P Index. (This strategy is not currently promoted by Robert Fulton.
S&P Index:
Single Premium:
Flexible Premium:
Clean of Administrative Expenses:
Premium Enhancement:
Surrender Charge:
Contract Year:
Contract Date:
Waiver of Surrender Charge:
10% Annual Free Withdrawal:
Tax Deferral of Profits:
Annual Statement:
Renewal Letter:
If you wish to review extreme basics about the types of Annuities in general, including definitions, and terminology go to the page to the page entitled “ Annuities Explained.” Italicized means to hyperlink it.