Premium Bonus

These annuities offer a Premium Bonus which is an incentive to purchase the contract. The bonus is based on the initial purchase amount, and often have vesting schedules which mean the bonus is credited day 1, earns interest day 1, but vests over the entirety of the contract. If the annuity is canceled before the contract term is complete, the bonus is pro-rated based on the amount of time in the contract prior to surrendering, canceling, or transferring away.