Which feature is provided if the annuitant is confined to a long-term care facility for at least 30 days?

Which feature is provided if the annuitant is confined to a long-term care facility for at least 30 days?

• A. Bail-out provision
• B. Deferred payout
• C. Interest rate guarantees
• D. Waiver

Answer: (D)

When a long-term care event happens, some annuity contracts include a protection that helps you access funds without penalties. This is the waiver of surrender charges. If the annuitant is confined to a long-term care facility for at least 30 days, the contract waives the surrender charges that would normally apply to withdrawals. That means you can take money out to cover care expenses without losing a portion of your principal to penalties, which is exactly what’s needed in a LTC situation. The other features don’t specifically address LTC confinement: bail-out provisions relate to exiting under different terms, deferred payout refers to delaying income, and interest rate guarantees concern the minimum credited rates rather than penalties for early withdrawals.

When a long-term care event happens, some annuity contracts include a protection that helps you access funds without penalties. This is the waiver of surrender charges. If the annuitant is confined to a long-term care facility for at least 30 days, the contract waives the surrender charges that would normally apply to withdrawals. That means you can take money out to cover care expenses without losing a portion of your principal to penalties, which is exactly what’s needed in a LTC situation. The other features don’t specifically address LTC confinement: bail-out provisions relate to exiting under different terms, deferred payout refers to delaying income, and interest rate guarantees concern the minimum credited rates rather than penalties for early withdrawals.