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How is an annuity scheme different from the fund management schemes?

April 26, 2017Annuity different fund Management Scheme Schemes

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How is an annuity scheme different from the fund management schemes?

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Annuity is a long term contract where the rates are locked in for the term of the contract. Unlike in the case of fund business (Gratuity, LE and SA fund management) in case of an annuity contract the annuity provider guarantees to make the promised payments for the duration of term as defined in the scheme. In essence the client’s risk is transferred to the annuity provider.