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?
- What's my state guaranty association's coverage limit for annuities, and how does this contract compare?
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.
The agents we work with 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.