About the contract
- What is the cap, participation rate, or spread this year, and what's the guaranteed minimum it can never go below?
- What's the surrender period, what's the charge each year, and is there a market value adjustment on top?
- How much can I withdraw each year without a charge, and from when?
- Which index options are available, and can I change them at each anniversary?
About riders and fees
- Is there an income rider or enhanced death benefit? What does it guarantee, what does it cost per year, and can I drop it later?
- What's the difference between the income base the rider grows and the cash value I could actually walk away with? They're not the same number.
About the carrier
- What's the carrier's financial-strength rating from AM Best and at least one other agency, and how long has it issued this product?
- Can the carrier lower the cap at renewal, and what renewal caps has it actually set on this product in past years?
About my situation
- Will I need any of this money before the surrender period ends? If the honest answer is yes, how much should stay out?
- How does the move happen: a direct transfer from my 401(k) or IRA, or a check to me? Direct is the one that avoids the 60-day rule and withholding.
And one for yourself
If this contract does exactly what the illustration says for ten years, and the market does better, will I be at peace with the trade? The people who regret indexed contracts are usually the ones who expected market returns from a product built to avoid market losses. The people who are glad they bought one are usually the ones who needed the money in a year the market fell.
Our agents expect these questions and will put the answers on paper. That's the standard. Anyone who won't meet it shouldn't get the money.