Annuity (payment)

“ An annuity is usually raised by the present payment of a certain sum as a consideration whereby the party making the payment, or some other person named by him, becomes entitled to an annuity, and the rules and principles by which this present value is to be computed have been the subjects of careful investigation. The present value of a perpetual annuity is evidently a sum of money that will yield an interest equal to the annuity, and payable at the same periods ”

“ An annuity de.- pending on the continuance of an assigned life or lives, is sometimes called a life annuity; but more commonly the simple term "annuity" is understood to mean a life annuity, unless the contrary is stated. A life annuity, to cease in any event after a certain term of years, is called a temporary annuity. The holder of an annuity is called an annuitant, and the person on whose life the annuity depends is called the nominee.
If not otherwise stated, it is always understood that an annuity is payable yearly, and that the annual payment (or rent, as it is sometimes called) is £1. ”

“ A simple annuity policy provides that in consideration of the payment at one time of a specified gross sum, the company will pay to the annuitant a stipulated sum annually, either for a stated term or during life; and a survivorship annuity policy, sometimes taken by one partner for another, by a debtor for a creditor, and otherwise for a business security, guarantees the payment of a stated sum to the person named by the person taking the policy during the period in which the nominee survives the insured. ”

“ An annuity is a periodical payment made either for a fixed number of years or whilst a given life lasts. It may be paid yearly, quarterly, weekly, or otherwise. It may come to one as a gift, or be left as a legacy, but it can also be purchased through an insurance company by the payment of a certain sum of money supposed to be its equivalent in value. ”

“ RESTORATION- If the requirements of paragraph (1) are satisfied, the survivor annuity shall be restored, commencing on the date the remarriage was dissolved by death, annulment, or divorce, at the rate which was in effect when the annuity was terminated. (C) LUMP-SUM PAYMENT- Any amounts becoming payable to the widow or widower under this subsection for the period beginning on the date on which the annuity was terminated and ending on the date on which periodic annuity payments resume shall be payable in a lump-sum payment. ”

“ Where any weekly payment has been continued for not less than six months, the liability therefor may, on application by or on behalf of the employer, be redeemed by the payment of a lump sum of such an amount as, where the incapacity is permanent, would, if invested in the purchase of an immediate life annuity from the National Debt Commissioners through the post-office savings bank, purchase an annuity for the workman equal to 75 per cent. ”

“ Suppose that it were desired to apply it to deduce the value of an annuity according to Deparcieux s mortality table given above, then we assume that annuities are bought on tha lives of 1000 nominees each 3 years of age. Of these nominees, 30 will die before attaining the age of 4, and no annuity payment will be made in respect of them; 22 will die between the ages of 4 and 5, so that the holders of the annuities on their lives will receive payment for 1 year; 18 attain the age of 5 and die before 6, so that the annuities on their lives are payable for 2 years. ”

“ It has come to your committee's attention that a few insurance companies have promoted a plan for selling annuity contracts based on the tax advantage derived from omission of annuities from the treatment accorded single-premium life-insurance or endowment contracts. The annuity is sold for a nominal cash payment with a loan to cover the balance of the single-premium cost of the annuity. ”

“ A standard annuity table (including a 3 1/2% interest assumption) is used to determine the dollar amount of the first monthly pay-out, based on a capital contribution of the accumulated amount, under the option selected by the investor. The number of 'annuity units' (which are functions of the fluctuating asset value of the portfolio of the company) that this amount would buy is computed, and this number of annuity units in paid (transmuted into a varying cash payment) to the investor every subsequent month for the duration of the company's commitment under the option selected. ”

“ In general.— Any payment made to an employee under the pilot program shall be in addition to the regular pay of the employee and to any other awards made to the employee, and shall not affect the entitlement of the employee to any regular pay, annuity, or award to which the employee is otherwise entitled or for which the employee is otherwise eligible or limit the amount thereof. ”

“ His monthly payment is not really a dollar payment, though it is converted into dollars before it is paid to him; it is a payment in terms of a portfolio of securities. It is true that the company has a fixed obligation to continue payments, and that the duration and the amount of the payments are not affected by collective longevity in excess of the company's assumptions; the company's obligation to continue payments is not limited in any way by reference to the number of units owned by all the investors at the start of their annuity periods. ”

“ A sample contract, given in evidence in the District Court, is one issued to a 35-year-old male, providing for his making 30 annual payments of $1,000 each. Of this, $39.60 is the consideration for an undertaking by the company by which payment of the annual $1,000 is waived in the event of disability. Of the remaining $960.40, designated the 'basic annuity premium,' specified percentages are used to credit to the account of the investor certain 'accumulation units.' Of the first year's 'basic annuity premium,' less than 45% is so used ”

“ Thus, for example, if a country gentleman of the age of 40 wished to borrow 10,000 upon a landed estate, the law forbade him to pay, or the lender to receive, more than 5 per cent, interest, say 500 a year ; but the law did not forbid his granting an annuity of 1000 for his life, secured upon the estate. Speaking roughly, an annual payment of 300 would be required to insure 10,000 upon the borrower s life, and the annuity would therefore return the lender about 7 per cent, interest, in addition to the premium on the insurance necessary to return his capital. ”

“ Any member of not less than five years' standing might, after ninety days' notice to the chief clerk, withdraw from the Association; and in such event he became entitled to receive seventy-five per cent. of the annual premiums paid to the Association. Also in case of death within two years of his retirement and prior to the payment of not more than twenty-four monthly installments of pension, the Association agreed to pay to the widow, the children, or legal heirs the annuity provided in the deceased member's certificate until the amount paid should aggregate seventy-five per cent. ”

“ For the payment of interest on an annuity of one thousand dollars, secured to the Cherokees by the treaty of the twenty-fourth October, eighteen hundred and four, and which was not paid till the year eighteen hundred and twenty-five, twelve thousand six hundred dollars, which sum shall be paid in the same manner and in the same proportions to the Cherokees east and west of the Mississippi that the annuity itself is payable. ”

“ And the same must be said of the value at which they have reckoned the short annuity of a half per cent. for ten years annexed to the new 4 per cents. In forming the scheme for the last loan this annuity was, I have said, estimated at 81⁄10 years purchase, agreeably to its real value, supposing the payments yearly, the first payment to be made at the distance of a year, and money improved at 4 per cent. compound interest. But it has in general been sold at about 71⁄2 years purchase; which is less than its value, supposing money improved at 51⁄2 per cent. compound interest. ”

“ However, the net premium guarantee is, because of this conversion system, also a guarantee that a certain amount of fixed-amount payment life annuity will be available at maturity.
After maturity the policyholder has no further interest in the 'Flexible Fund.' He has either received the value of his interest in cash, or converted to a fixed-payment annuity in which case his interest has been transferred from the 'Flexible Fund' to the general reserves of the company, and mingled, on equal terms per dollar of cash value, with the interests of holders of conventional deferred annuities. ”

“ To establish its contention, the Government must aggregate the premiums of the annuity policies with those of the life insurance policies and establish that the annuity payments were derived as income from the entire investment. ”

“ Variable annuity policies are a recent development in the insurance business designed to meet inflationary trends in the economy by substituting for annuity payments in fixed-dollar amounts payments in fluctuating amounts, measured ultimately by the company's success in investing the premium payments received from annuitants. One of the early pioneers in this field was Teachers Insurance and Annuity Association, a New York regulated life insurance organization engaged in selling annuities to college personnel. ”

“ These documents and proofs will be submitted to the proper superintendent, agent, or sub-agent, and at the next period of paying annuities the same will be laid before the persons superintending such payment. They will inquire into the circumstances, and interrogate the Indians; and if they are satisfied the claim is just, they will then make a formal demand upon the tribe for satisfaction. If, thereupon, such tribe agree to make satisfaction, the amount shall be taken from the annuity due to such tribe, and paid to the person entitled thereto. ”

“ If it were certain that a person of any age, say 39, would live for a year, then the value of an annuity on his life would be such a sum as would increase at interest in a year to the value of an annuity on a life one year older, say 40, increased by a present payment of 1 ”

“ Art. III. The bonds of this loan shall not be subject to any tax for the benefit of our Government.
Art. IV. A fixed annuity of £E. 307,125 (315,000l.) to be applied to the service of this loan, shall be levied as a first charge, and under the guarantee resulting from the International Convention of [114] upon the revenues assigned to the service of the Preference Debt and the Unified Debt [115] .
Art. V. The portion of this annuity which is not absorbed by the payment of the interest shall be assigned to the redemption of the Guaranteed Loan. ”

“ It is probable that compensation to stockholders will consist of annuities rather than lump sums. The advantage of compensation by annuity rather than by cash payment is considerable. As the state is taking over industries it will be more difficult for individuals to find investment for lump sums than to-day. ”

“ But annuities for uncertain periods, and particularly life annuities, are more frequent, and the value of the annuity is computed according to the probable duration of the life by which it is limited. Such annuities are often created by contract, whereby the Government or a private annuity office agrees, for a certain sum advanced by the purchaser, to pay a certain sum in yearly, quarterly, or other periodical payments to the person advancing the money, or to some other named by him, during the life of the annuitant. ”

“ In the case of single lives, the annuity may be made to com- mence at a future period, and the consideration for it may be paid by the purchaser annually in sums of money not less than £5, but in case of default in keeping up the annual instalments, all the annual payments previously made are forfeited, and all right to the annuity is ex- tinguished. ”

“ He proposed that, in order to receive an annuity in later years, any person, male or female, rich or poor, should be allowed to deposit with the Government any sum, paid in instalments, if desired, and the sum should be increased by the Government’s subsidy. ”

“ Of course, if an employee does choose, upon the bankruptcy of his employer, to seek work with an employer not covered by the contract, he ceases to participate in the annuity plan and may, under the terms of that plan, claim the monies that have accrued in his account. ”

“ I own it would be highly agreable to me, to have always a sum of money lying by me, besides my income; for I do assure you, Sir, that it is much more a scheme of economy than of expence. I should employ about seven or eight hundred of it to encrease my annuity during a year and a half and to enable me to travel agreably. ”

“ While all the States regulate 'annuities' under their 'insurance' laws, traditionally and customarily they have been fixed annuities, offering the annuitant specified and definite amounts beginning with a certain year of his or her life. The standards for investment of funds underlying these annuities have been conservative. The variable annuity introduced two new features. First, premiums collected are invested to a greater degree in common stocks and other equities. Second, benefit payments vary with the success of the investment policy. ”

“ In case of death, a certain sum is paid for funeral expenses, an annuity to the widow, if one is left, equal to 20% of the deceased’s annual wages—if the widow remarries, she receives a lump sum equal to three annual payments in liquidation of the annuity—an annuity to each legitimate child equal to 15%, or, if the child has no mother, equal to 20% of the father’s wages; an annuity to the father or mother, if dependent on the deceased for support, equal to 20% of the annual wages. ”