Difference Between the Disclosure Statement, Transfer Agreement, and the Annuity Contract

By Newswire Sept. 14, 2014 2:06 p.m.

What is the Difference Between the Disclosure Statement, Transfer Agreement, and the Annuity Contract?

 The Disclosure Statement

The disclosure statement is the document you get first-(ten or more days).  The transfer company is required by law to send you the Disclosure Statement with specific criteria, written in a specific manner.  The Statement has to do with the very complex, macro-economic equation that calculates inflation, IRS rates, the current value of the dollar, future value of the dollar and time and HOW, not WHAT, but HOW the company comes about charging you.

The disclosure statement is also a brief statement on behalf of California State Law alerting you of your rights in this contract as a consumer.

Your biggest alert and protection is the right to seek a free independent legal adviser.

The Transfer Agreement

This is the second set of documents that you will get.  It’s usually thicker and it is the actual contract between you and the transfer company.  In contract law, it’s called a California Purchase Contract.

The Annuity Contract

Chances are, you’ll never see this contract.  You might see the “schedule of benefits information” for the Annuity Contract, but this contract was between two very large companies.

 This is the contract of the purchase of the annuity between the casualty insurer, and the life insurer; naming you as the intended third party beneficiary because of a personal injury, or a wrongful death claim; stating compliance with the specific IRS Tax Code, and that the proceeds are tax exempt in addition to the benefit schedule breakdown, and their terms and conditions according to their rules.

 

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