Wouldn't it be an appealing topic to you if there was a way for your family to have a long term stable cash flow to meet the varying needs of generations? Today, I'm going to walk you through an exploration of the features and uses of annuity insurance to see how it can help us accomplish this.

First, let's understand annuity insurance

Annuity insurance is a type of life insurance that pays out life insurance premiums in installments at agreed-upon intervals based on the conditions of the insured's survival. Payment of the life fund is usually made in the form of regular annual payments of a certain amount, hence the name annuity insurance.

Classification of annuity insurance

1. By purpose, there are retirement, education, marriage, etc.

2. According to the period of payment, it can be divided into fixed annuity, life annuity and minimum guaranteed corporate annuity.

Annuity is the period of time for which the insurer and the insured agree to pay the insurance annuity. A fixed annuity is a periodic annuity that is paid by the insurer until the end of the period for which it is payable, regardless of whether the insured is alive or not.

A lifetime annuity is a time when the insurer terminates the payment of the insurance annuity by the death of the insured. That is, the insured will continue to receive the annuity as long as the insured survives. This type of insurance is the best deal for insureds who live a long time, but the benefits end once the insured dies.

Minimum Guaranteed Annuity, a precautionary form of annuity created to prevent the insured from dying prematurely and losing the right to receive an annuity. It has two payment methods: one is to guarantee the benefits of the insured and his/her beneficiaries according to the number of years of payment, and this form of minimum guaranteed annuity determines the minimum number of years of payment, and in case of the death of the insured within the stipulated period, the beneficiaries designated by the insured will continue to receive the annuity until the end of the period.

3. Depending on when annuity payments begin, they are categorized as immediate and deferred annuities.

Immediate annuity refers to the annuity pension insurance that the insurer pays the medical insurance annuity on a regular basis immediately after the insured pays the premiums of the enterprise-owned company and the insurance service contract can be established and take effect. Usually the immediate annuity system adopts the single payment method as well as the payment of premiums, therefore, the single payment is the main form of immediate annuity.

廷期年金 is an annuity insurance that is paid by the insurer after the insurance contract has come into effect and the insured reaches a certain age or after a certain period of time has elapsed. This type of annuity dominates the market.

Let's take a look at the functions and features of annuity insurance.

1. Compulsory saving function: Young people buy annuities to help compulsory saving. Today's young people like to spend, borrow and consume money in advance, and these habits will gradually show great disadvantages as they grow older. People need to prepare for old age at a relatively young age, when they are more capable in all aspects, for example, by preparing their money before saving in order to cope with the declining earning power in old age. Since annuities cannot be withdrawn once they have been in existence for at least 10 years (they lose their principal), they may become mandatory for saving. Over time, the money will be saved.

2. income stability. Annuities generally have a guaranteed rate of return. This is undoubtedly a breath of fresh air for investment products in the current trend of netting all bank financial products. This guaranteed income can be written into the contract, locking in a relatively high interest rate in the future, taking advantage of the background of the larger downward movement of interest rates. There are many annuities with with-profits features. Dividend income, although unstable, can also play a large part in the fight against inflation.

3. Supplementary and planning and management functions for future business cash flow. Middle-aged people can configure lifetime annuities for students themselves to solve the problem of insufficient pensions in China. This reflects the supplement to the cash flow. Parents can also purchase fixed-term annuities for their children, which have a maturity time and allow parent-teachers to simultaneously plan and design as well as purchase service time and purchase amounts based on the actual amount and timing of the need for significant use of these funds.

Having said that, it is time to talk about the subject of the article title. We know that annuity insurance is a product that can provide a stable cash flow over time. If we design the policy properly, we can maximize the effectiveness of the time. For example, let the parents as the policyholder, when the child is just born, his annuity insurance, the child receives and his lifetime stable cash flow.

As long as the money is not taken, it goes up and up. Annuity insurance is compound interest and will rise very substantially over decades of accumulation. Even if you need to use the money in the middle, it's no problem. If you buy an annuity when the child is born, it will grow nicely by the time the child is about 20 years old. By this time the parents are usually in their 50s and the child's grandparents are probably between 70 and 80. At this point, retirement expenses can be drawn from the annuity account; the parents can use it for retirement when they get older; and the child can use the money if he or she wants to start a business or get married. As long as you control the amount of withdrawals each year, this account will provide a constant flow of funds, and you don't have to worry about it when you don't make withdrawals. The annual increase in the account will automatically accumulate compound interest.

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