What Is Annual Premium Equivalent (APE)? An annual premium equivalent (APE) is a common sales measure calculation used by insurance companies in the United Kingdom. The annual premium equivalent is the sum of the total value of regular–or recurring–premiums plus 10% of any new single premiums written for the fiscal year. If desired, the premiums earned by
What Is an Annual Report? An annual report is a document that public corporations must provide annually to shareholders that describes their operations and financial conditions. The front part of the report often contains an impressive combination of graphics, photos, and an accompanying narrative, all of which chronicle the company’s activities over the past year
What Is an Annual Return? The annual return is the return that an investment provides over a period of time, expressed as a time-weighted annual percentage. Sources of returns can include dividends, returns of capital and capital appreciation. The rate of annual return is measured against the initial amount of the investment and represents a
What Is Annual Turnover? Annual turnover is the percentage rate at which something changes ownership over the course of a year. For a business, this rate could be related to its yearly turnover in inventories, receivables, payables, or assets. In investments, a mutual fund or exchange-traded fund (ETF) turnover rate replaces its investment holdings on
What Is Annuitization? Annuitization is the process of converting an annuity investment into a series of periodic income payments. Annuities may be annuitized for a specific period or for the life of the annuitant. Annuity payments may only be made to the annuitant or to the annuitant and a surviving spouse in a joint life
What Is an Annuitization Method? The term annuitization method refers to an annuity distribution structure. Annuities are financial contracts distributed by financial institutions that allow individuals to invest money over a period of time to give them a source of income in the future—normally during retirement. Annuity contracts outline the method of payment. These options
Investopedia / Ryan Oakley What Is an Annuity? The term “annuity” refers to an insurance contract issued and distributed by financial institutions with the intention of paying out invested funds in a fixed income stream in the future. Investors invest in or purchase annuities with monthly premiums or lump-sum payments. The holding institution issues a
What Is an Annuity Certain? An annuity certain is an investment that provides a series of payments for a set period to a person or the person’s beneficiary or estate. It is an investment in retirement income offered by insurance companies. The annuity may also be taken as a lump sum. Because it has a
What Is Annuity Consideration? An annuity consideration or premium is the money an individual pays to an insurance company to fund an annuity or receive a stream of annuity payments. An annuity consideration may be made as a lump sum or as a series of payments, often referred to as contributions. Key Takeaways An annuity
What Is an Annuity Contract? An annuity contract is a written agreement between an insurance company and a customer outlining each party’s obligations in an annuity agreement. Such a document will include the specific details of the contract, such as the structure of the annuity (variable or fixed); any penalties for early withdrawal; spousal and
