Medicaid

In the simplest term Medicaid is health insurance for the poor. This program was enacted in 1965 as part of the Social Security Act. It is a joint Federal State program providing medical assistance to the aged, blind or disabled, and families with dependent children who cannot afford such assistance. Since the program is administered by the individual states under federal guidelines, the benefits offered and eligibility requirements vary widely. Around 36 million people in U.S alone are covered by Medicaid. Usually, Medicaid recipients pay no part of costs for covered medical expenses, although a co-payment is sometimes required.

Medicare

It is a federal insurance program which primarily serves those over 65 years old and younger but disabled people and dialysis patients. This program was enacted in 1965 as part of the Social Security Act. Currently about 37 million Americans are covered by Medicare. The program has two parts--Part A that covers hospital insurance, and part B which covers supplementary health insurance.

Multi-Year Interest Rate Guarantee Annuity

Multi-year interest rate guarantee annuity is a type of annuity that offers an interest rate that is guaranteed for multiple years, like five, seven, or ten years.

Net Capital Gains

Realized and unrealized capital gains on investments is called net capital gain. It can be described as the sum of positive and negative capital gains in other words.

No-Load

An investment sold directly to customers at net asset value without a sales commission, e.g. a no-load mutual fund or a no-load annuity. Annuities are almost always commission-free because the commission is usually paid by the insurance company itself.

Non-qualified

Non-qualified annuity refers to the annuity that has been purchased outside of an IRS-approved pension plan. Contributions are made with after-tax dollars. Earnings can accumulate tax deferred until withdrawn. In other words any annuity that is not used to fund a tax qualified plan such as an IRA, Keogh, SEP, SEP IRA, or TSA is Non-qualified.

Participation Rate

In an equity-indexed annuity, the percentage of the growth in the equity index, used in the formula to determine the interest rate credited to the annuity is termed as participation rate.

Payout Period

The period during which the money accumulated in an annuity is paid out as regular income payments. It is the period during which you receive the income from your annuity contract. Options include: for life, for life with a certain number of years guaranteed, or for a certain period such as ten or fifteen years.

Point-to-Point

It is a method of measuring total movement in an equity index from the annuity policy issue date to the end of a particular period, the period is usually of five to ten years. Equity-indexed annuities can use this method to determine how much to credit the annuity, typically by crediting the account a certain percentage of the measured point-to-point growth in the equity-index.

Policy Owner or Policy Holder

Policy Owner or Policy Holder is the person who owns a life insurance policy. This is usually the insured person, but it may also be a relative of the insured, a partnership or a corporation.