South Carolina Life Insurance Practice Exam

Who possesses all the rights in an annuity?

1. The annuitant

2. The beneficiary

3. The annuity owner

4. The insurance company

The correct answer is: The annuity owner

In the context of annuities, the owner holds all the rights associated with the contract. This includes the ability to make decisions regarding the investment, withdraw funds, and designate beneficiaries. While the annuitant is the person whose life the annuity is based upon and may receive benefits from the contract, they do not necessarily have the rights to manage the annuity. The beneficiary is designated to receive any remaining funds after the death of the annuitant but does not possess any rights during the lifetime of the annuitant or owner. The insurance company provides the contract and pays out according to its terms, but it does not hold rights to the account itself. Thus, the annuity owner is the individual or entity that retains full control and decision-making authority over the annuity.