By simply naming a beneficiary other than the estate on the application form, the proceeds of the annuity pass through to the beneficiary without the delay and expense of probate. You earn competitive yields even before tax advantages are computed. An initial effective rate is guaranteed by the issuing insurance company for a fixed term, usually one year from the contract date. Thereafter the interest rate is reset for one-year intervals and will not be less than the minimum guaranteed rate in your insurance contract. Liquidity of Funds Partial withdrawals equal to a specified percentage of the total value are allowed each year after the first year.
Percentages vary with different insurance carriers.
All principal and interest can typically be withdrawn after five to seven years with no charge. You also have flexibility in the way you make withdrawals. Lump sum, partial or tax-advantaged withdrawals are available. With most annuities you can make additions at any time.