reversionary annuity
Học thuậtThân thiện
Definition
Noun: A reversionary annuity is a specific type of financial contract. It is an annuity that is designated to be paid to one person (the reversioner or secondary annuitant) only if and when a primary, named annuitant is unable to receive the payments. This "inability to receive" is typically due to the death of the primary annuitant before the annuity's term ends, but it can also be triggered by other predefined conditions.
Usage
This term is used primarily in legal, financial, and insurance contexts to describe a contingent beneficiary arrangement for annuity payments. - It specifies a backup plan for annuity income. - The payment obligation reverts from the primary annuitant to the secondary annuitant upon a triggering event.
Examples
- The pension plan included a reversionary annuity for the employee's spouse.
- He purchased a life insurance policy with a reversionary annuity rider, ensuring his daughter would receive payments if he died prematurely.
- The trust was set up to provide a reversionary annuity to the donor's sibling, contingent on the donor's own death.
Advanced Usage
- Legal/Trust Context: A reversionary annuity is often established within a trust deed or a will, specifying the order of beneficiaries for a stream of payments.
- Contingent Interest: It creates a or in the annuity for the reversioner, which only becomes possessory upon the failure of the primary interest.
Variants and Related Words
- Reversionary Interest: (Noun) A broader legal term for any future interest that reverts to the grantor or passes to a third party.
- Survivor Annuity: (Noun) A common type of reversionary annuity specifically designed to provide continued income to a surviving spouse or dependent.
- Contingent Annuity: (Noun) An annuity whose payments depend on the occurrence of an uncertain event, which includes a reversionary annuity as a subtype.
Synonyms
- Survivorship Annuity (when contingent on death)
- Contingent Annuity
- Secondary Annuity
Related Phrases
- Reversion to: The act of the annuity benefits passing to the secondary annuitant.
- Upon the holder's death, the annuity underwent a reversion to the named beneficiary.
- Payable on reversion: Describing the status of the annuity payments.
- The funds are held in trust and are payable on reversion.
Noun
- an annuity payable to one person in the event that someone else is unable to receive it