| ISSUE/CONCERN |
STRUCTURED SETTLEMENT |
EQUITY MUTUAL FUND |
| What types of securities/insurance products support the payments? |
A fixed annuity contract issued by a life insurance company. Assets are invested in the insurance company's general account. |
An investment company operates the fund,
pooling the assets of many investors and
investing in equity securities. |
| Can this option provide a stable, lifetime income? |
Yes. Payments and distribution schedule are determined up front. Can provide a dependable, predictable income stream that you cannot outlive. |
Historically, equities have shown the greatest potential
for long term growth. But they also entail a higher degree
of investment risk, which means they may not be a
reliable source for ongoing income needs. Earning
may stop together if fund performs poorly. |
| Is there a guarantee with this option? |
Yes. The annuity issuer guarantees payments, as provided by the terns of the structured
settlement agreement. |
No. Share prices and returns will fluctuate with
investment performance. |
| What are the costs and fees associated with this option? |
No cost to the annuitant. |
Management and expense fees cover the costs of
managing the fund and are deducted from returns.
Fund may also change a front-or back-end "load" (i.e. sales charge), redemption fees (paid by
investors when they "redeem" or sell shares) and
12b-1 charges. |
Will this option keep pace
with inflation? |
Yes, with a Cost-of-Living-Adjustment (COLA)
feature. |
Taxes must be paid as income is earned and distributed.
Capital gains or losses from sales of mutual fund shares
have additional tax consequences. |
| What are the tax consequences? |
Income provided by the fixed annuity is TAX-FREE
provided the damages received as periodic income
(other than punitive damages) are the result of
personal injuries or physical illness. |
Fund yield, share price and return will vary, depending
on market conditions. You may have a gain or a loss depending on market conditions. You may have a gain
or a loss, depending on when you sell your shares. |
Is this option affected by
market fluctuations? |
No Benefit payments are determined and fixed at
the time the annuity contract is issued. |
Money can be withdrawn or moved form one mutual fund
to another. Charges, fees and taxes may apply to
each transaction. |
| Can I make changes to this option after I select it? |
No. Payment amount and schedule are fixed and
may not be changed or accelerated. |
|