The national annuities guide covers types, phases, payout options, surrender charges and taxation. Georgia sets annuity contract provisions in O.C.G.A. 33-28 and the best-interest rule in Rule 120-2-94.

Contract provisions (33-28)

• Grace period: at least 30 days, during which the contract stays in force (33-28-2(b)(1)).
• Incontestability: incontestable after two years from issue, during the life of the person on whose life it is written.
• Misstatement of age or sex: payments are adjusted to what the premium would have bought. Overpayments can be recovered with interest of up to 6%.
• Reinstatement: within one year of default, unless the cash value has been paid. Reversionary annuities allow three years.
• Free look: every annuity, reversionary annuity and pure endowment contract, except group annuities, may be returned within 10 days after receipt for a refund (33-28-6).

Best interest (Rule 120-2-94)

• A producer recommending an annuity must act in the consumer's best interest. Four obligations apply: care, disclosure, conflict of interest and documentation (Rule 120-2-94-.06).
• What the rule does not do:
  • make the producer a fiduciary
  • create a private right to sue
  • require guaranteed results
• Consumer profile: age, income, financial situation and needs, objectives, risk tolerance, tax status and more.
• Disclosure: the sources and types of cash and non-cash compensation. A reasonable estimate of cash compensation is given on request.
• Exempt: contracts funding ERISA plans and employer plans under IRC 401(a), 401(k), 403(b), 408(k) or 408(p), plus government and church plans.
• Training: a one-time 4-credit course, which counts toward CE.
• Records: kept five years after the insurer completes the transaction.

Licensing, replacement and guaranty

• Variable annuities need the variable products license: the life class, an 8-hour variable course, and FINRA registration (Series 6, 7, IR or GS).
• Georgia's life replacement rule (120-2-24) exempts annuity replacements unless they are specifically included.
• Guaranty association: up to $300,000 in present value of annuity benefits, with $250,000 for cash surrender and withdrawal values (33-38-7).

Exam traps

• The annuity free look is 10 days in Georgia, the same as for life.
• Annuity reinstatement is allowed for 1 year. Life policies allow 3 years.
• Best interest is not a fiduciary duty. Training is 4 credits, once. Records are kept 5 years.