Variable Annuity FAQsLocated at:
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Frequently Asked Questions

  1. What is a variable annuity?
  2. Where can I send in my payment?
  3. I did not receive a bill or notice of premium due.
  4. How do I change my beneficiary?
  5. What if I want to change how frequently I am billed?
  6. How do I change my billing to have deductions occur automatically from my checking account?
  7. How do I make a single payment from my checking account to pay my premium?
  8. How do I change my method of billing to be sent to me in the mail versus automatic account deductions?
  9. What are the benefits of an annuity?
  10. What are the differences between a Traditional IRA and a Roth IRA?
  11. Can I move the funds in my qualified retirement plan from one contract to another contract without paying taxes?
  12. If I withdraw money from my annuity, will I have to pay taxes?
  13. What is a 1035 exchange?
  14. How long does it take to receive money from my policy?
  15. Are death benefit proceeds taxable?
  16. If I sign up for automatic account deductions, when will the deduction occur from my account?
  17. How do I surrender my annuity?


Variable Annuities are designed to supplement a retirement program, serving as long-term savings vehicles and efficient sources of retirement income. Deposits to a variable annuity are invested in equity and/or fixed income funds.

The value of the annuity (and income ultimately received) is directly related to the performance of the funds within the annuity. The fund selection process is critical and will vary for each individual depending on tolerance for risk and desired return.

A variable annuity can be issued as a nonqualified annuity, an individual retirement annuity (IRA), or a tax-shelter annuity (TSA). The amounts that can be paid into the annuity contract and the tax-treatment of withdrawals from it will depend on what type of annuity it is nonqualified, IRA or TSA. [
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Please send your billing notice with your payment. If you do not have a billing notice, please write your policy number on your check and send in your payment(s) to the following address:

CMFG Life Insurance Company
2000 Heritage Way
Waverly, IA 50677-9202

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You will only receive a bill notice if you are on the direct bill method, (versus automatic account deductions), which sends a bill to your home. Our system bills approximately 27 days prior to when the premium is due. Please allow up to seven days for your notice to reach you. If after seven days you have still not received your bill, you may do one of the following:

  • Send a payment to us online by clicking on "Make a Payment". A deduction will occur from your checking account to pay the current premium due.
  • Sign up for automatic account deductions so you no longer have to worry about receiving a bill. To do this, just click on the option to "Setup/Change Automatic Payment Plan" and follow the instructions.
  • Send us a payment to the following address, making sure you have noted your policy number on your check stub.

    CMFG Life Insurance Company
    2000 Heritage Way
    Waverly, IA 50677-9202
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A Change of Beneficiary form can be downloaded from the
Variable Annuities Forms page. Send the original form, signed by the owner, to our office to be reviewed and recorded. You may want to keep a copy for your records. [Return to Top]



If you are currently having your premiums automatically deducted from your account, you can change how frequently premiums are deducted by clicking on the option to "Setup/Change Automatic Payment Plan". You can then select the frequency to monthly, quarterly, semi-annual or annual in the drop down box beside "Billing Frequency".

If you are currently receiving your bills through the mail to your home, you will need to call our office to change how frequently you are being billed. Please call us at 1-800-798-5500. [
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To setup automatic account deductions from your checking account, just click on the option to "Setup/Change Automatic Payment Plan" and follow the steps. [
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To make a single payment from your checking account to pay your premium, click on the "Make a Payment" option and complete the steps. [
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Click on the option to "Stop Automatic Account Deductions", and follow the steps. [
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Individual Retirement Arrangements (IRAs) are personal savings plans that give you tax advantages for setting aside money for retirement. IRAs can be an individual retirement account or an annuity, which can be either a fixed or variable annuity. It must be set up in the United States in your name and for the exclusive benefit of you or your beneficiaries.

Following is a chart of the primary differences between Traditional IRAs and Roth IRAs

  Roth IRA Traditional IRA
Eligibility Investors with compensation meeting income limits
OR
Non-income earning spouses who file a joint return with a working spouse who meets the income limits
Investors under age 70 1/2 with compensation
OR
Non-income earning spouses who file a joint return with a working spouse
Annual
Contribution
Limits
See IRA Contribution Information
(then use your "Back" button to come back here)
Federal
Taxes
  • Contributions are not tax deductible
  • Contributions and earnings are free from federal tax upon withdrawal under specified conditions.
  • Distributions are not required at age 70 1/2
  • Contributions may or may not be deductible depending on your income tax filing status, modified adjusted gross income (MAGI), and eligibility to participate in a tax-qualified retirement plan through employment.
  • Earnings grow tax deferred and are taxed as ordinary income upon withdrawal as are deductible contributions.
  • Minimum distributions are required beginning at age 70 1/2

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Yes. Each type of retirement plan defines the options available which generally include transfers, direct rollovers and indirect rollovers.

Transfer
A transfer is a method of moving qualified funds from one trustee to another without triggering a reportable event. Transfers often occur between two financial institutions but they can also be between contracts or accounts at the same institution. To qualify as a transfer:
  • It must be between "like kind" plans (e.g. Traditional IRA to Traditional IRA, Roth IRA to Roth IRA), and
  • There must be no constructive receipt of the funds. In other words, the check must be payable and directed to the receiving financial institution as trustee.

Direct Rollover
A direct rollover is a method of rolling eligible distributions from one type of qualified retirement plan to another type of qualified retirement plan (e.g. Tax Sheltered Annuity (TSA) to a Traditional IRA, 401(k) to a Traditional IRA). To qualify as a direct rollover:
  • The funds distributed must be an "eligible rollover distribution" which can generally be described as a distribution you receive upon a qualifying event such as retirement, termination of employment, attainment of age 59 1/2, or disability. The Internal Revenue Code defines eligible rollover distributions for each plan type.
  • The receiving qualified retirement plan must allow for the acceptance of rollovers, and
  • The funds must be transferred directly from one financial institution to another for your benefit. In other words, the check must be payable and sent to the receiving financial institution as trustee.

Indirect Rollover
An Indirect Rollover is another method of rolling qualified retirement plan assets from one qualified plan to another (e.g. 401(k) to Traditional IRA, Traditional IRA to Traditional IRA). In an indirect rollover, the plan participant or IRA holder has constructive receipt of the funds from the distributing plan. In other words, the check is made payable to the account owner instead of the receiving financial institution.

Generally, individuals receiving the funds from a qualified retirement plan have 60 days to roll the funds into another qualified plan to avoid taxation. This can be accomplished by endorsing over the check or writing a personal check to the receiving financial institution. The receiving plan must allow for the acceptance of the rollover. The Internal Revenue Code defines eligible rollover distributions for each plan type. Additionally, amounts distributed from a qualified retirement plan or TSA may be subject to 20% mandatory withholding.

Please call us at 1-800-798-6600 to discuss specifics of transfer or rollover options or to request the necessary forms. [
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The answer to this question depends largely on the tax status of the annuity - Traditional IRA, Roth IRA, or Tax Shelter Annuity (TSA).



A 1035 exchange is the exchange of an insurance contract for another that meets all the requirements of Section 1035 of the Internal Revenue Code (IRC 1035). When a contract is exchanged under IRC 1035, the gain or loss of the exchanged contract is transferred to the new contract.

Only the following types of exchanges will qualify for non-taxable treatment:
FROM: TO:
Life insurance policy Life insurance policy; nonqualified annuity contract
Endowment contract Nonqualified annuity contract
Nonqualified annuity contract Nonqualified annuity contract

The other requirements for non-taxable treatment include:
  • The owner and insured/annuitant on both contracts must be identical.
  • The contract being exchanged must be in force. If the contract is maturing, the 1035 exchange request must be signed prior to the maturity date.
  • The entire value of the existing contract must be exchanged. If any cash is received, the taxable gain up to the amount of cash received is taxable.
Please call us at 1-800-798-6600 to discuss what constitutes a valid 1035 exchange, who qualifies, and the forms you'll need to complete an exchange. [
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The length of time it takes to receive your money will depend on the time at which the request is received and the delivery method that you choose.

Requests received prior to 3:00 p.m. Central Time are processed that same day. Requests received after 3:00 p.m. are considered received the next business day and are processed on the following business day.

Delivery methods available include:
Method Time Charges
Check - sent via U.S. Postal Service Sent the day after request is processed. Receipt depends on U.S. Postal Service. None
Check - sent via Overnight Delivery Service Sent the day after request is processed. For most areas, you will receive the check the next business day. Some remote areas take 2 business days. $25.00
Wire to your account Funds will be credited to you account the day after we process your request. We need the name of your financial institution, routing and account numbers, type of account (savings, checking, or share draft), and names on the account. $25.00
Electronic Funds Transfer Funds will be credited to your account within 48 hours (business days) after your request is processed. We need the name of your financial institution, routing and account numbers, type of account (savings, checking, or share draft), and names on the account. None
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Life insurance proceeds are not taxable.

The gain portion of annuity proceeds is taxable to the beneficiary when it is distributed. There are several ways to defer the gain. Contact us for more information on specific settlement options available. Our telephone number is 1-800-779-5433, ext. 4833351 (if your policy was purchased by mail or phone), or 1-800-798-6600, ext. 4833351 (if your policy was purchased through a local representative). [
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The first deduction may not occur on the day you selected. We will send you a confirmation letter notifying you before the first deduction occurs. Thereafter, a draft will be sent on the specific day of the month you requested account deductions. If no draft day is designated, we will determine the date deductions will be sent based on the policy due date. Actual deduction from your account will occur 2 business days after the draft is sent, or longer if a holiday. Ex: you selected the 1st of the month for account deductions; if the 1st falls on a weekend, we will send the draft on the next business day, and the deduction will occur 2 business days later. [
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Call our contact center at 1-800-779-5433 (if your policy was purchased by mail or phone) or 1-800-798-6600 (if your policy was purchased through a local representative) from Monday through Friday - 7 a.m. to 7 p.m., CT for a surrender form. Because of the importance of this decision, including possible surrender charges and taxation, an original surrender form signed by the contract owner is required to surrender the annuity. [
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Representatives are registered, securities are sold, and investment advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor, 2000 Heritage Way, Waverly, Iowa 50677, toll-free (800) 369-2862. Nondeposit investment and insurance products are not federally insured, involve investment risk, may lose value and are not obligations of or guaranteed by the financial institution. CBSI is under contract with the financial institution, through the financial services program, to make securities available to members. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America. The Representative may also be a credit union employee that accepts deposits on behalf of the financial institution.


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