Annuity - The Best Form Of Guaranteed Investment

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Often we are confused and fail to understand the difference between annuity and structured elements. The culprit probably is some commonality that exists between the two. Even after reading a number of free articles on structured settlements, misunderstandings seem to persist.

What Are Annuities And Structured Settlements?

Annuities are contracts sold by an insurance company with a view to make payments to the holder at specified intervals later in life. In other words, annuities refer to a series of payments of a specified sum at a specified frequency paid to a retired person.

Structured settlements are prearranged cash payouts made thorough an annuity system to compensate injury victims for their losses. The United States Congress in 1982 passed a special legislation making large structured settlements mutually agreeable to both the parties while at the same time ensuring certain minimum protection to victims. Not all cases, however, come under the purview of free articles on structured settlements.

Examples Of Cases Which Do Not Fall Under The Scope Of Structured Settlements Include:

* ...
... Simple accidents where the injured party recovers completely

* Cases where the duration of treatment is not very long

* Cases where injury is not very severe

Here Are Some Examples Where Structured Settlements Are Applicable:

* In cases of severe injury requiring long term medical care, necessitating future treatment cost as well as living expenses for the victim.

* In wrongful death cases where the surviving relatives need regular income to compensate for the death of the victim.

* Certain guardianship cases where minors have psychological or physical handicaps.

Learn About The Best Annuity

There are many free articles on structured settlements, but most of them miss out the best part of annuity benefits. This could be because annuities unfortunately, took the backseat for many years. Many people shrug off annuities as expensive gimmicks. Earlier bonds and stock markets were popular and both were considered the best bet for long term security. The recent stock and bond crash has changed all that. Now, people are considering annuities as the best form of investment to take them through the age of 8o and beyond and many people are discovering the benefits of annuities too.

The reasons are not far to seek. In the 1930s, retirement lasted just for a few years with the life expectancy being about 60. As life expectancies increased, workers started depending on company pensions to carry them through retirement. These days many retired people live for a quarter of a century or more after retirement. In fact, there are good chances that at least one spouse will live beyond 90.

To sustain life till 90s and beyond, only annuities can help but people are worried because there seems to be a catch when you opt for annuities.

Suppose you pay a lump sum to an insurer and you die prematurely, the insurer rather than your heirs get what is left of your cash. The situation has changed considerably over the past few years. Insurers have floated products which offer choices such as liquidity, exit options, and the assurance that your inheritors will be the first to benefit from your assets.
It is not surprising that many free articles on structured settlements provide useful information on annuities. After all, annuities are proving to be the best form of guaranteed investment.

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