Accrual of Interest
The process where interest builds over time.
Period of time where an annuity grows in cash value before payments are distributed.
The person who receives annuity benefits based on their life expectancy.
When annuity benefits are converted to income through a series of periodic payments.
The person who receives benefits if the annuity owner dies.
Legal agreement between an insurance company and the person who purchases the annuity.
The insurance company that sells the annuity, and pays its benefits.
The person or party that purchases the annuity and pays premiums.
Investment options used as retirement plans or personal injury settlements.
Insurance companies that offer certain guarantees and options for retirement income.
An investment with money-back guarantees that provides periodic payments with interest over a period of time. They often provide additional income after retirement.
Better Business Bureau
A nonprofit organization devoted to assisting businesses and protecting consumers.
Legal agreement representing a loan that earns interest.
The person or legal firm active in arranging a financial exchange between a buyer and seller.
Immediate funds from selling an annuity.
The difference in profit or loss when an asset, like an annuity, is purchased or sold.
Insurance company employee.
Money that is accessible before it is earned.
The amount of money that can be withdrawn from an annuity after surrender charges are subtracted from total value of the annuity.
Catastrophic Injury Case
Deals with clients who have serious injuries that result in long-term consequences.
CBC Settlement Company
Headquartered in Conshohocken, Pennsylvania, this settlement purchasing company partners with Annuity.org. It was founded in 2004 and holds an “A” rating from the Better Business Bureau.
Certificates of Deposits (CDs)
An insured financial product, consisting of money deposited and held for a fixed period of time during which the sum earns interest. It is similar to a savings account.
The person in a lawsuit who is making a claim.
Made up of two annuities; one paid out immediately, one paid out later.
An award, often in the form of money, given to make up for a loss.
The process where investments earn interest.
The maximum amount you can contribute to a retirement fund.
Payments made to a fund.
Court Approval of Best Interest
Necessary judgment in order to sell annuity payments
Legal award, often monetary, to compensate for injuries.
Part of some annuity contracts, guaranteeing payments will go to beneficiaries if annuitant dies.
The person or entity sued or accused in a legal matter.
Annuity payments are delayed until the owner opts to receive them.
Postponed; in taxes, to be paid at a later date.
Emptied of funds.
Provides annuitants money directly, rather than negotiating between parties.
Trained to get disability claims approved.
Payments from an annuity.
Early Withdrawal Penalty
IRS fee of 10 percent for withdrawals made by those under 59 ½.
Employer-Sponsored Retirement Account
An account that is able to grow tax deferred.
A combination of a fixed and variable annuity.
Purchases settlements and provide short-term access to money.
Formal name for selling a structured settlement.
Federal Deposit Insurance Corporation (FDIC)
The Congress-run agency responsible for supervising and insuring stability of financial institutions.
A contract where the payment amount and time period of distribution are both fixed.
Following the first premium payment, both the amount and frequency of deposits in this annuity can change.
Guaranteed Income Security
An annuity benefit of receiving lifetime disbursement of payments.
Annuity contracts that specify payments will be made whether the annuitant is living or deceased.
Costs that are not disclosed upfront.
Begins paying you within a year, rather than after a long-term accumulation phase; also known as an income or single premium immediate annuity (SPIA).
A government tax contingent upon how much money is earned annually.
Independent Broker Dealers
Firms responsible for trading securities.
Indexed Rate Annuity
A fixed annuity with an option of choosing a declared interest rate or one based on an outside stock index.
Individual Retirement Accounts (IRA)
A type of savings account offering major tax benefits.
Economic term describing the increase in cost of goods and services as time passes.
The person or group of people suffering from an adverse circumstance in a lawsuit.
Installment Refund Annuity
The contract stipulates that if the annuitant dies before all income benefits are paid, a beneficiary will receive the difference.
The amount charged or paid for using money.
Life Contingent Payment
A payment from a structured settlement that is discontinued upon the death of the annuitant. There are no beneficiaries of annuities with life contingent payments.
Life-with-Period Certain Annuity
Type of annuity that has smaller payments, but guarantees a specified amount of payments. If the annuitant dies before the period ends, payments will go to a beneficiary. If the annuitant outlives the payment period, there will still be payments until the annuitant dies.
The ability to easily access money.
A one-time payment, rather than a series of payments.
A lawsuit resolution resulting in a payment.
Money Market Accounts
Based on interest rates from traded loans between banks and other institutions.
Based on how long one lives, money accumulates which can be transferred from the annuitant to a beneficiary.
Professionally managed investment accounts used with securities such as stocks, bonds and other assets.
National Association of Settlement Purchasers
Serves the public by providing information on the practice and regulations of secondary market of settlement purchasers.
National Structured Settlement Trade Association
A resource to settlement claimants and professionals who work with accident survivors and dependents.
This type of settlement is used when claims for damages fall outside the usual scope of physical injury, sickness or wrongful death.
Choosing to sell only a portion of annuity payments.
The person receiving annuity funds.
Annuity income that is paid out, typically in a series of payments.
The second phase of annuity life where payments are made.
a defined, long-term financial vehicle sponsored by a company to guarantee income to retired workers later in life.
Payments made at regular intervals.
Periodic Payment Settlement Act (PPSA)
Signed into law in 1982, this act promotes the use of structured settlement by providing certain tax benefits.
Personal Injury Lawsuit
Legal matter that may result in an agreement that is paid in a lump sum or structured settlement.
The party who initiates a lawsuit.
A regular payment made to keep insurance coverage active.
The current cash value of an annuity, as calculated using a specific discount rate.
The amount that is originally invested, not including subsequent interest.
The legal process of handling a deceased person’s estate.
A statement adding to the specifications of a law or contract.
The traditional structured settlement for physical injury or sickness claims.
A provision added to a contract.
Approved by an official.
Secondary Market Annuity (SMA)
An annuity purchased from the original owner, then transferred to a third party, which may then sell payments at a discount.
The competitive industry where annuity payments are purchased in return for lump-sum cash payments.
Financial instrument that can be used as a tradable asset.
Single Premium Annuity
Purchased with a lump-sum payment, instead of a series of payments. It is also known as an immediate annuity.
State Lottery Commission
State-run lottery regulatory agencies.
Structured Settlement Protection Act (SSPA)
Passed in 1997, these state-defined laws originated in Illinois and regulate the secondary market.
A legally agreed upon settlement, paid in the form of an annuity, or schedule of continuing payments.
A fee for withdrawals made before the end of the surrender period.
Method of annuity distribution where deferred annuity payments can be scheduled at regular withdrawals instead of a guaranteed income stream.
Describes income that can grow free of taxes.
Taxpayer Relief Act of 1997
Allowed structured settlement use for workers’ compensation cases.
Time Value of Money
The changing value of money based on earned interest and inflation over time.
Transfer of Structured Settlement Payment Rights
Must be approved by a judge.
Value based on fluctuating interest rate from various smaller investments.
Brokerage firms which buy and sell financial securities.
Taking money out of an account.
Workers’ Compensation Claim
A lawsuit regarding work-related injuries or loss of income; usually result in a structured settlement.
Wrongful Death Claim
A lawsuit regarding death liability; usually result in a structured settlement.
A lawsuit regarding illegal employment termination; usually result in a structured settlement.