Instead, the purchase payment or amount annuitized is used to buy a certain number of annuity units.
Finally, the initial income paymentis divided by the value of the annuity unit for each subaccount chosen.
Genworth, which is based in Richmond, Virginia, is in the process of trying to get its ordinary life and annuity units
out from under the umbrella of the struggling long-term care insurance business.
Commenting on the transaction, CEO Allan Levine further explained that, as a result of the divestment, both the P&C and the life and annuity units
of his company will be more focused on their individual long-term strategies and objectives.
Unlike accumulation units, the number of annuity units
then remains constant.
The number of annuity units received depends not only upon the existing accumulation units, but also upon the insurance company's assumptions regarding mortality, dividend rates, and expenses.
Once annuitized, the number of annuity units remains constant but the dollar amount of the annuity payments will fluctuate depending upon the investment results of the underlying assets.
For example, assume an annuitant was entitled to a payment based on 10 annuity units
When Variable Annuity units
are redeemed they may be worth more or less than their original cost.
Prudential is making the announcement as some if its competitors are planning or implementing efforts to separate from individual life and annuity units
, due to concerns about low interest rates, new accounting rules and new marketing rules.
Genworth Financial announced earlier that it hopes to separate the units that write LTCI coverage from its life and annuity units
MOST ANALYSTS AND PRODUCERS agreed on the strength and resilience of AIG's mammoth life and annuity units
in interviews conducted shortly after AIG said Maurice Greenberg had been replaced as CEO.