For people who already own a fixed or indexed annuity worth $50,000 or more
The rate that sold you your annuity may not be the rate it’s paying you today.
Many fixed and indexed annuities open with an attractive first-year rate, cap or participation rate. At renewal, the insurance company can lower it, as far down as the minimum written in your contract. Nobody calls to tell you. It shows up as one line on a renewal notice.
Dear annuity owner,
You bought your annuity on purpose. Someone sat across from you, showed you a rate or a cap, and it sounded good. It probably was good. That year.
Then, often, the agent moved on. The contract stays behind, and nobody is assigned to it. Try these three questions without looking anything up:
- What cap, participation rate or fixed rate is it crediting this year, and what was it the year you bought it?
- How close is today’s rate to the minimum in your contract?
- When did anyone last go over your beneficiaries, riders and renewal notices with you?
If those are hard to answer, that’s not carelessness. Nobody walks you through it after the sale.
The first-year number was the sales number
That number often isn’t locked in for the life of the contract. Many contracts let the insurance company change caps, participation rates and fees from time to time.1 The state regulators’ buyer’s guide says when a rate period ends, the insurance company sets a new rate, higher or lower than the earlier one. The floor is the guaranteed minimum stated in your contract.2
The rate in the brochure got you in. The renewal rate is the one you live with.
What a lower cap actually costs you
A cap is the most your contract can be credited in a year. FINRA gives the plain example: if the index rises 12% and your cap is 7%, you get 7%.1 Now run that same good year with a cap the insurance company lowered at renewal.
| Same $200,000 contract, same index year (+12%) | Credited |
|---|---|
| The cap you bought: 7% | $14,000 |
| The cap after a renewal cut: 4% | $8,000 |
| What the lower cap cost you that year | $6,000 |
Made-up numbers to show the arithmetic. Not any real contract, insurer, cap or index result, and not a prediction of any index. Your contract’s caps, participation rates and minimums are what count.
Notice when the cut hurts. Not in a flat year. In the good year, the one you were counting on to make up for the others.
Beneficiaries: the form that beats your will
If you die before you start taking income, the death benefit goes to the people named as beneficiaries on the contract.2 FINRA, writing about investment accounts, puts it bluntly: a beneficiary document supersedes your will.6
Since you signed, has anyone died? Divorced? Remarried? That old form may decide who gets this money. Your state’s rules and your contract control the details.
Sometimes the best answer is to keep what you have. A review tells you what you own and what it’s actually doing, so you can decide on purpose.
The honest part: leaving can cost you
Surrender charges are real. For indexed annuities they usually apply for six to ten years after purchase.1 Moving to another annuity can mean a brand-new surrender schedule and lost benefits. Any recommendation has to be in your best interest.3
A good review starts from what you have and why you bought it. If keeping it is the right call, that’s what you should hear.
Who this is for, and who it isn’t
A good fit if you…
- Own a fixed or indexed annuity worth $50,000 or more.
- Can’t say what your rate or cap is this year, or what it was when you bought.
- Haven’t heard from the agent who sold it in a long time.
Probably not for you if…
- Someone went through your renewal history with you in the last year and you’re happy with it.
- You don’t own an annuity yet.
- You only want a variable annuity reviewed (see below).
Common questions
Will you tell me to switch?
No. This is a review of what you already own. Sometimes the best answer is to keep it. Most states follow model rules from the National Association of Insurance Commissioners (NAIC). Under the annuity best-interest rule, any recommendation has to be in your best interest, and the insurance company must review it before the contract is issued.3 Under the replacement rule, if a new annuity would replace one you own, you get a written notice about replacement and the insurance companies involved are notified.4
How do I find out if my cap or rate dropped?
Your insurance company sends a notice or statement around each contract anniversary showing the rate, cap or participation rate for the coming year. Line them up from the year you bought. If you can’t find them, the insurance company can tell you. Your contract states the minimum. Caps work on the same kind of schedule, and some contracts guarantee a minimum cap.2 The regulators’ buyer’s guide tells buyers to ask, before they sign, when the renewal rate will be announced and how the insurance company will tell them.2
What about a variable annuity?
Variable annuities are securities, regulated by the SEC and FINRA.5 A variable annuity has to be reviewed by a professional with the proper securities license. The specialist on this site is a licensed insurance agent, so they may not be able to review it.
How do I know if I’m paying for a rider?
Many annuities let you add features called riders, usually at an extra cost. A common one on fixed indexed annuities is an income rider (a guaranteed lifetime withdrawal benefit). Enhanced death benefits can cost extra too.2 If you bought an income rider and now don’t expect to take income from this contract, ask what it costs you each year and what you get for it. Your contract lists any riders you added. Your annual statement or the insurance company can tell you what each one costs and how it’s charged. Ask what it does for you today, not what it did the day you bought.
When did I last update my beneficiaries?
If you don’t know, that’s the answer. The insurance company can tell you who is named on the contract right now, and how to change it.
Could I owe a surrender charge?
If you’re still inside the surrender period and take out more than the free amount, yes. Some contracts also have a market value adjustment that can raise or lower what you receive if you leave early. Your contract spells out both.
Is this a sales call?
No. The checklist is free and the 15-minute call is free. You are never required to buy anything.
Who will I talk to?
A licensed insurance agent in your state. The agent is independent, not an employee of this website, and may recommend insurance products such as annuities if they fit what you tell them.
Get your annuity review checklist
Five quick questions. Round numbers only, no contract numbers. Your checklist shows on screen.
What kind of annuity do you own?
It’s usually printed at the top of your annual statement.
How long have you owned it?
If you own more than one, answer for the largest.
Roughly what is it worth today?
Has your cap or rate dropped since you bought it?
Compare the cap, participation rate or fixed rate from your first year with your latest renewal notice. “I don’t know” is an honest answer.
Do you still hear from the agent who sold it?
Would you be open to a quick, no-pressure call with a specialist?
You’ll see your checklist either way.
Where should we send your checklist?
It’s ready now. We’ll also show it on the next screen.
Preview note: consent wording reused from the existing YRSO pages. Pending compliance review.
Sources and notes
- FINRA, Investor Insights, “The Complicated Risks and Rewards of Indexed Annuities” (July 14, 2022): some contracts allow the issuer to change fees, participation rates and caps from time to time, which could adversely affect your return; returns could be significantly less than the index; surrender charges usually apply within the first six to 10 years; “If an index rises 12 percent but an investor’s EIA has a cap of 7 percent, their returns will be limited to 7 percent.” www.finra.org/investors/insights/complicated-risks-and-rewards-indexed-annuities
- National Association of Insurance Commissioners, “Buyer’s Guide for Deferred Annuities” (2022 edition, accessed October 8, 2026): after a fixed rate period ends the insurer sets a new rate that “could be higher or lower than the earlier rate”; the guaranteed minimum interest rate is stated in the contract; some annuities guarantee a minimum cap rate; ask when the renewal rate will be announced and how the insurer will tell you; riders “usually at an extra cost,” including guaranteed living benefit riders and enhanced death benefits; the death benefit is paid to your beneficiaries. Any minimum is subject to the claims-paying ability of the issuing insurer. content.naic.org/sites/default/files/publication-anb-lp-consumer-annuities-fixed.pdf
- NAIC Suitability in Annuity Transactions Model Regulation (#275), as revised in 2020 to a best-interest standard, including insurer review of recommendations before issue. content.naic.org/sites/default/files/model-law-275.pdf. States adopt their own versions; rules vary by state.
- NAIC Life Insurance and Annuities Replacement Model Regulation (#613): replacement notice to the consumer and notification of the insurers involved. content.naic.org/sites/default/files/model-law-613.pdf. States adopt their own versions.
- Variable annuities are registered securities. SEC, Investor.gov, “Updated Investor Bulletin: Variable Annuities,” www.investor.gov/introduction-investing/general-resources/news-alerts/alerts-bulletins/investor-bulletins/updated-5; FINRA Rule 2330, www.finra.org/rules-guidance/rulebooks/finra-rules/2330
- FINRA, Investor Insights, “Plan Now to Smooth the Transfer of Your Brokerage Account Assets on Death” (January 17, 2023): “a TOD plan or other beneficiary document supersedes your will.” Written about brokerage accounts; how an annuity’s beneficiary designation works is set by your contract and state law. www.finra.org/investors/insights/plan-ahead-transfer-your-brokerage-account-assets-death
- Hypothetical examples on this page (the 7% vs. 4% cap on $200,000) are made-up numbers that show arithmetic only. They do not describe any real contract, insurer or index result and are not a projection.
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Your free 15-minute call with Kyle
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- If what you have is already working, we’ll tell you.
- Bring your contract and latest statement.
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What to check, for your contract
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- Your annuity contract. If you can’t find it, the insurance company can send a copy.
- Your latest annual statement. It shows the value, surrender value and current rates.
- Any renewal-rate notices. Even one or two help show which way your rates have gone.
- Your spouse or partner, if they share decisions about this money.
- Your questions. Write them down so none get missed.
This is not a high-pressure sales call. Kyle will go through what you own, what it’s crediting now and what it credited when you bought it. Sometimes the best answer is to keep what you have, and if that’s the case, that’s what you’ll hear.
Kyle will call from (XXX) XXX-XXXX placeholder: routed number. Save it so you know it’s him.