
What is an annuity?
An annuity is a long-term product designed for retirement planning. It can help protect your future, with guaranteed income for life, so you don’t outlive your savings during your golden years.
When you buy an annuity, you enter into an annuity contract with an insurance company. You make contributions either by making monthly payments or one lump sum payment. Then, when the time comes, you receive regular payments (or one lump sum, if you prefer).
Besides providing a guaranteed income stream, annuities may help protect you against inflation and market risk. And if you pass away while your annuity is still active, it provides your loved ones with an income stream. Annuities from AAA Life Insurance Company offer you peace of mind, no matter what happens.
How do annuities work?

Annuities have two phases:
- During the accumulation period, you pay a series of annuity premiums over the years—or just a single payment—to the issuing insurance company. The insurance company then invests those funds to grow tax deferred and accrue interest.
- The annuitization or the distribution phase is when you stop making payments and the annuity starts paying you. The money you put in comes back to you as income. Your money is invested to grow over time, so the later you begin receiving annuity payments, the larger those payments will be. You can either choose to receive regular annuity payments—just like a paycheck—or get your money all at once in a lump sum payment. If you choose to receive periodic payments, you can either receive them for a specified period or for the rest of your life.
How does your money grow with an annuity?
With an annuity, the life insurance company takes on investment risk. AAA Life Insurance Company offers two types of annuities:
Fixed annuities are the safest type of annuity. They provide minimum guaranteed interest rates. Fixed annuities are not subject to market downturns, so when you receive future annuity payments, you can count on guaranteed income. Fixed annuities are regulated by state insurance commissioners.
Indexed Annuities
Indexed annuities are a type of fixed annuity that earn returns based on a stock market index like the Standard & Poor’s 500, the Nasdaq-100, or the Russell 2000 Index. Your returns won’t match the market index exactly. Instead, parameters are set to limit your potential losses and gains, offering more stability than investing directly. That is why this type of annuity is also called a “fixed indexed annuity.” Indexed annuities are also regulated by state insurance commissioners.
When does an annuity owner get paid?
The type of annuity contract you choose determines when you start getting paid. There are two possible arrangements, immediate and deferred annuities.
An immediate annuity starts making periodic payments to you within one year after you purchase the annuity.
With a deferred annuity, also called a “deferred income annuity,” you receive income payments starting on a future date that you choose. It must be at least one year after you buy the annuity, but it typically starts making payments several years later.
AAA Life Annuities
You deserve to enjoy your retirement worry free. AAA Life Insurance Company offers two types of annuities—Platinum Bonus Annuity and Guaranteed Income Annuity—that help you grow your nest egg and protect your future with guaranteed income.
Platinum Bonus Annuity (Fixed Deferred)
The AAA Platinum Bonus Annuity provides a fixed, competitive interest rate, as well as a first-year bonus. (Note: The first-year bonus rate you earn is based on the amount of your issue amount.)
The Platinum Bonus Annuity offers the flexibility to contribute as much or as little as you like. (There are limits after the first year and contributions are subject to suitability review.) You can decide when you add to your annuity fund without having to follow a fixed schedule. In the event of your passing, AAA will pay the accumulated cash value, minus any premium taxes, to your designated beneficiary.
Platinum Bonus Annuity Key Features:
- A competitive interest rate and first-year bonus
- Maximized earnings through the power of tax deferred growth
- Includes a five-year surrender period
- A minimum guaranteed interest rate of 2.80%
Issue Amounts | First-Year Base Interest Rate2 | First-Year Bonus Rate | Total First-Year Annuity Rate |
---|---|---|---|
$3,000 - $49,999 | 4.25% | 2.00% | 6.25% |
$50,000 - $499,999 | 4.25% | 3.50% | 7.75% |
$500,000 and above | 4.25% | 5.00% | 9.25% |
Guaranteed Income Annuity (Fixed Immediate)
Single premium immediate annuities like the AAA Guaranteed Income Annuity are suitable for people who want to leverage some of their savings to create retirement income they won’t outlive.
You provide a single premium amount from your savings account, 401(k), or other assets. Then you can relax knowing that you’ll receive guaranteed monthly income payments. Customize how often you get paid and how long the payments will last—for your lifetime or however long you choose. If you select the Joint Lifetime Guarantee option, the annuity can continue to make payments to your spouse or partner after you have passed away.
Guaranteed Income Annuity Features:
- A competitive payout rate
- Fixed income that isn’t subject to market changes
- After two years, income can be accelerated for unexpected needs
Why should I buy annuities through AAA?

AAA offers annuities backed by a name you can trust. At the heart of our work is a commitment to protecting people throughout their lifetime.
When you buy an annuity from AAA Life Insurance Company, you’ll enjoy benefits such as:
- Customized plans
- No administrative fees
- Guaranteed minimum interest rates
- Financial expertise backed by 50 years of experience