 |
|
|
| Glossary |
| |
| 1035 Exchange |
|
Under Section 1035 of the Internal Revenue Code, certain insurance and annuity contracts may be exchanged for new contracts with no gain or loss recognized on the exchange. Internal revenue Service tax rules must be followed to achieve the desired result. |
 |
| Adjustable Interest Rate |
|
Interest crediting option in which the accrual interest rate will be adjusted at your chosen time interval based upon the prevailing U.S. Treasury Strip Rate for the same time interval as of the adjustment date. This rate will be capped at the 30-year U.S. Treasury Bond Rate on the adjustment date. |
|
| BRK Direct |
|
Berkshire Hathaway Group of Insurance Companies. |
|
| Contract Value |
|
The Contract Value equals the Single Premium Payment to BRK Direct, plus accrued interest. Interest shall be computed on the basis of a 360 day year consisting of twelve 30 day months. Interest will be compounded annually. |
|
| Fixed Interest Rate |
|
Interest crediting option in which the interest accrual rate is fixed and guaranteed for the duration of the Contract. |
|
| Interval Period |
|
The period between interest accrual rate adjustment dates. |
|
| Market Value Adjustment |
|
The market adjusted value will equal:
V * [(1 + i) / (1 + j)](N/12), where
| i = |
the then current Interest rate being credited for the Interval Period in which the Surrender Date occurs. |
| j = |
the asked rate on the Applicable U.S. Treasury Strip maturing on, or closest to, the last Business Day of the current Interval Period as shown in The Wall Street Journal at the close of business on the Surrender Date, plus 200 basis points. |
| N = |
the number of whole months from the Surrender Date to the last Business Day of the then current Interval Period. |
| V = |
the Contract Value on the Surrender Date if Owner had not elected Surrender Option |
|
|
| Maturity Date |
|
The date your Contract Value becomes due. |
|
| Owner |
|
The Owner owns the Annuity. The Owner will have the right to designate or change the Payee to whom the benefits are payable under the annuity. Unless otherwise stated, the Owner shall also be the Payee. |
|
| Payee |
|
Person(s) or entity to whom payments are made under this contract. If two or more Payees are designated and their respective interests are not specified:
- their interests will be several and equal and;
- in the event of the death of a Payee, any payments due shall be divided equally among the surviving Payees. Multiple Payees may not be designated if the designation would result in any Payee receiving less than $1,000 per payment.
|
|
| Single Premium Payment |
|
A product that does not require further investment by the purchaser after the premium is paid. |
|
| SPIA |
|
This product can guarantee the purchaser a level income for life. See SPIA product on our Web-site. |
|
| Surrender Date |
|
The date on which you request your Contract Value prior to the Maturity Date. |
|
| Tax Qualified Plan |
|
A retirement plan that allows an employee to make pre-tax contributions to an annuity. Examples include Pension Plan, Profit Sharing Plan, 401 (k) Plan, Tax-Deferred Annuities and IRAs. |
|
| Tax-Deferred Annuity |
|
An annuity that offers the same tax deferral benefits as a non-deductible IRA account. This is offered without the $2,000 contribution limit, without the mandatory withdrawal requirements at age 70 1/2, and without all of the record-keeping and reporting requirements associated with IRA's. |
|
| Thirty-year U.S. Treasury Bond Rate |
|
"Benchmark 30-year" U.S. Treasury Bond rate as printed in the Wall Street Journal or similar publication. |
|
| U.S. Treasury Strip Rate |
|
U.S. Treasury Coupon Interest (ci) Strips will be used to price your SPDA. These rates are shown in the Wall Street Journal or similar publication. This rate will be capped at the 30-year U.S. Treasury Bond Rate on the reset date. |
|
| |
 |
|
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |