The value the IRS places on the benefits provided to an employee under a split dollar or qualified pension plan. This amount is reportable as taxable income by the employee, but is offset by any contributions the employee makes. The term insurance rate used to determine the value of the benefit may be based on the insurer's published rates or the government's PS 58 rates. A form of annuity contract sold by life insurance companies that allows the contract owner to select the investment funds and assume the investment risk.
Variable annuities guarantee a payment, usually at retirement.
The amount of the payout will vary, however, with the value of the underlying investment funds. Variable annuities may only be sold through life insurance agents, who in addition to being licensed life insurance agents, are registered representatives. Both deferred and immediate variable annuity contracts are available. An annuity that provides retirement income payments which fluctuate according to the investment performance of the underlying mutual funds. The insurer guarantees that payments will continue for the lifetime of the annuitant, but it cannot guarantee the amount of the payment or the performance of the account.