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How Index-Linked Annuity Interest Crediting Functions
12-11-2014, 07:25 AM
Post: #1
Big Grin How Index-Linked Annuity Interest Crediting Functions
One-Year Month-to-month Point-to-Point

The monthly point-to-point index change is determined by subtracting the prior months index value from present months index worth and dividing it by the prior monthsindex value. If this results in a positive monthly point-to-point index modify and is not a lot more than the declared cap, then it is

employed as the capped index alter for that month. If it is far more than the declared cap, then we use the declared cap as the capped index change for that month.

A negative monthly point-to-point index modify is not topic to a cap.

A capped index adjust for every month is captured more than a 12-month period. The sum of the 12 month-to-month capped index alterations will be the index credit rate on the index crediting date. The index credit rate is multiplied by the choices account worth to establish the index credit.

A single-Year Annual Point-to-Point

The annual point-to-point index change is determined by subtracting the prior years index value from the current years index worth and dividing it by the prior years index worth. We discovered http://surfline.com/company/bios/index.cfm by browsing Bing. If this final results in a positive annual point-to-point index modify and is not much more than the declared cap, then it is used as the index change for that year. Should people hate to be taught further about surfline.com/company/bios/index.cfm, there are tons of on-line databases people might consider pursuing. If it is more than the declared cap, then we use the declared cap as the index alter for that year.

A unfavorable annual point-to-point index adjust is not subject to a cap. The index modify will be the index credit rate on the index crediting date. The index credit rate is multiplied by the choices account worth to establish the index credit.

Participation Rate

The participation rate may very drastically from one annuity to yet another and from time to time inside a certain annuity. Should people choose to learn further about Submit Your Site To Search Machines - Metabolik, we recommend many online libraries people might consider pursuing. As a result, it is important for you to know how your annuitys participation rate functions with the indexing strategy. A high participation rate might be offset by other functions, such as simple interest, averaging, or a point-to-point indexing strategy. On the other hand, an insurance coverage business may possibly offset a decrease participation rate by also supplying a

feature such as an annual reset indexing method.

Annual Point-to-Point

The index-linked interest, if any, is based on the distinction amongst the index worth at the finish of the 1 year term and the index value at the start off of the one year term. Browse here at jump button to check up the reason for it. Interest is added to your annuity at the finish of the one year annual reset term.

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