Nonforfeiture guarantee protects against which of the following?

Nonforfeiture guarantee protects against which of the following?

• A. The insurer will waive surrender charges
• B. The life expectancy is guaranteed
• C. The contract owner will not lose surrender value if payments stop before annuitization or death
• D. The investment account is protected from losses

Answer: (C)

Nonforfeiture guarantees are about protecting the money you’ve already put into the contract. If you stop making payments or surrender the contract before you begin to take annuity payments (annuitization) or before death, you won’t be left with zero value. The insurer must at least return a minimum value, often the premiums paid, creating a floor under the surrender value. This protection matters in variable annuities because the account value can fluctuate and surrender charges may apply. It does not promise a longer life or shield the investment account from market losses, and it doesn’t automatically waive surrender charges; it ensures you won’t lose all prior value by guaranteeing a minimum surrender value.

Nonforfeiture guarantees are about protecting the money you’ve already put into the contract. If you stop making payments or surrender the contract before you begin to take annuity payments (annuitization) or before death, you won’t be left with zero value. The insurer must at least return a minimum value, often the premiums paid, creating a floor under the surrender value. This protection matters in variable annuities because the account value can fluctuate and surrender charges may apply. It does not promise a longer life or shield the investment account from market losses, and it doesn’t automatically waive surrender charges; it ensures you won’t lose all prior value by guaranteeing a minimum surrender value.