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Fixed Annuities
Virginia Bar Association Insurance: created by Virginia lawyers for Virginia lawyers. Formerly Virginia Barristers Alliance, Inc.

Serving Virginia's Legal Community Since 2001

Virginia Barristers Alliance, Inc., is now Virginia Bar Association Insurance.


Annuity options provide guaranteed income for life, income for a specific period of time or a combination of both. The annuity payout method is elected by the contract owner.

Earnings in a fixed annuity grow tax-deferred. When money is taken out of the contract, the earnings are taken out first, and are taxed as ordinary income.

Why It's Important

Annuities offer features that make them useful retirement tools for some individuals, including retirement income and tax-deferred gains:

Retirement income

When you purchase an annuity, you can choose payments that last a lifetime or for a time that you specify. Lifetime payments can be made throughout your life or extended to last the lifetime of your spouse or another person. Extending payments through the life of a second person generally reduces the amount of the periodic payment.

Tax-deferred earnings

You can build up savings in annuities without paying federal income taxes on gains on the funds until you begin to withdraw money. Each company sets maximum amounts for initial contributions to your annuity, and most annuities allow you to contribute additional money at any time. If you assign an annuity as collateral for a loan, however, the tax-deferred treatment of the account ends.

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Which Payment Option Is Best for You?

Annuities offer many options for receiving your payments, including:

Straight life annuity

This option provides payments from an annuity for the rest of your life, even if the payments exceed the money you put into the annuity. While this option usually pays out the most, if you die before all of the money you put in has been distributed, no additional payments will be made to your dependents.

Joint and survivor annuity

This annuity provides payments to you as long as you live and to a designated beneficiary as long as he or she lives.

Life income with refund annuity

With this product, payouts continue for life, but if you die before collecting all the premiums you have paid, your beneficiary collects the remaining money.

Life annuity with period certain

This annuity offers income for life. If you die before receiving the total of premiums paid, your beneficiary receives payments for the remainder of the period.

How VBAI Can Help

Deciding which company and contract to select is where we can help meet your specific needs. We talk with you about your objectives and your tolerance for risk. We discuss the available choices to help you decide whether a fixed annuity is a good option to consider. We shop the marketplace to find quality choices for our clients. We give strong consideration to the financial strength and well-being of the company issuing the contract. We also evaluate rates of return. Some contracts offer a guaranteed rate for a time, then a new rate each year. Others offer contracts that have a guaranteed rate for the life of the contract.*

* Guarantees are subject to the claims-paying ability of the insurance company issuing the annuity.

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Frequently asked questions (FAQ)

Glossary of fixed annuity terms

Glossary of insurance terms

VBAI staff

The information provided herein is not written or intended as tax or legal advice and may not be relied upon for purposes of avoiding any federal tax penalties. Entities or persons distributing this information are not authorized to give tax or legal advice. Individuals are encouraged to seek specific advice from their personal tax or legal counsel.


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