Describe the profile of a typical annuity purchaser;

Identify the principal reasons why individuals purchase annuities;

Explain the traditional concept of an annuity; and

Identify the parties to an annuity contract and discuss their roles.

Identify the methods by which annuity premium payments are made;

List the expenses generally associated with annuity contracts;

Explain when payout begins under deferred and immediate annuities;

Discuss how cash values are accumulated;

Describe annuity death benefits; and

Discuss the various annuitization methods available to settle annuity proceeds.

Discuss how cash values are determined in a variable annuity;

Explain how the various variable annuity cash value management tools help contract owners manage the volatility of variable annuity cash values allocated to variable subaccounts;

Identify the various guaranteed living benefits available on variable annuity contracts;

Describe how variable annuitization may enable a contract owner to overcome the erosion of annuity income and keep pace with inflation;

Discuss the features and benefits of variable annuities; and

List the factors that should be evaluated in determining the suitability of a variable annuity for a customer.

Discuss how the current crediting interest rate is determined in declared-rate annuities;

Distinguish bonus and multi-year guarantee annuities from other types of annuities;

Describe the factors that affect the effective crediting interest rate in indexed annuities;

Explain how index call options are used in the operation of indexed annuities; and

Identify the various interest crediting methods used in indexed annuities.

Discuss the income tax treatment of nonqualified annuity premiums and cash values;

Explain how nonqualified annuity surrenders and withdrawals are taxed;

Describe the exclusion ratio and its impact on the tax-free recovery of basis from periodic annuity payments made under nonqualified annuity contracts; and

Explain the income and estate tax treatment of death benefits received under a nonqualified annuity contract.

Define suitability in the context of an annuity transaction;

Describe the client information required to perform an appropriate annuity suitability analysis;

List the types of information that must be disclosed when making an annuity recommendation;

Identify those situations in which an insurance producer has no suitability obligation to the client; and

Describe the suitability recordkeeping obligations to which insurance producers are subject in connection with recommended annuity transactions.