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LearnInsurance.com >> Designation Courses >> CAS Professional

Become a CAS Professional

Course Outline | FAQ's

Well over $1 trillion is invested in variable annuities alone. Annuities are second in popularity only to mutual funds. Yet, even though this investment vehicle has been around for over 50 years, there has never been a certification program devoted exclusively to fixed-rate and variable annuities - until now.

Tradition and innovation describe annuities today. Most investors have heard of annuities, but are either misinformed or understand only a product type. The Certified Annuity Specialist (CAS) has both the knowledge and depth to be able to explain both fixed-rate and variable annuities in a way the client can easily understand. Whether used as an alternative to bank CDs or as a means of investing in the stock market with guarantees, annuities now provide assurances that are not offered by other investments.

The Institute of Business & Finance (IBF) has been offering designations for over 17 years. The Certified Annuity Specialist (CAS) designation was initially created due to the demand from the 14,000+ members of the IBF. The ongoing popularity of the program is due to the financial community's recognition that investors' interest in tax-deferred growth is increasing almost exponentially.

The tax benefits of annuities are well known, but pairing the correct title to the right person is not. Close to a third of all annuity contracts are not titled correctly. The potential tax and legal liability of such a mistake is enormous. The CAS practitioner understands the nuances and ramifications of proper titling as well as how tax benefits can be extended beyond what most agents are doing.

The investing public realizes that general practitioners can only provide knowledge and help to a certain point. When it comes to someone's nest egg or the use of a complex investment vehicle, investors want an expert. The CAS designation demonstrates the advisor's expertise and commitment. And, since it differentiates one from the tens of thousands of other advisors who offer the same products, it is also an excellent marketing tool.

In recent years, there has been negative press about annuities as a whole. The CAS graduate is able to address those public perceptions by comparing and contrasting different types of annuities to mainstream investments. The 60-hour certification program covers traditional fixed-rate annuities, equity-indexed annuities, variable annuities, living benefits, as well as the basics of asset allocation. The CAS designation is the oldest and most respected annuity designation in the financial services industry.

The CAS program is a 60-hour self-study program. The cost of the program is $1,165. The cost includes everything: registration, shipping, materials, testing, and the first year's certification fee. Materials include: Introduction to Annuities, Getting Started in Annuities, Selected Readings I, Selected Readings II, Student Manual with sample questions, and the Mutual Fund & Variable Annuity Directory.

The final exam is given at Thomson Prometric Centers which are located throughout the country. The exam is administered by the NASD. Students must also complete an open-book case study. The CAS program is fully accredited.

View CAS Brochure

Course Cost: $1,165

Course Outline

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Module I - How Annuities Work

Multiple levels of protection provide insulation from a wide range of catastrophies. This tax-advantaged platform provides safety, guarantees plus accumulation and distribution options not found in other investments.

  • Fixed-rate, variable, immediate, and deferred
  • Withdrawals, liquidations, and taxation
  • Annuitization options and the premium tax
  • Tax deferral and crediting methods
  • Reserve requirements and state guaranty pools

Module II - Working with Annuities

Only a few advisors are familiar with the nuances of annuities. The advent of living benefits creates the opportunity to seek higher returns with a safety net that results in a worst-case scenario that still provides attractive growth and income.

  • Investment options and strategies
  • Contract structure
  • Interest-indexed and bonus rate products
  • CD, MVA, and two-tiered annuities
  • Living and death benefits

Module III - Equity-Indexed Annuities (EIAs)

EIAs have experienced exponential growth. Due to complexity and commission abuses, this product has been targeted by the press and regulatory bodies. With objective information, the knowledgeable and ethical practitioner sees the right role for EIAs.

  • Popularity and evolution of EIAs
  • Contract terms, liquidity, and guarantees
  • Reserves, surpluses, and design behavior
  • Margins, caps, floors, and participation rates
  • Death benefits and surrender charges

Module IV - EIA Advanced Concepts

Investors can match expected market behavior with a specific participation method in order to maximize gains. Understanding the contract from the issuer's perspective gives the advisor special insight into what kind of EIA structure is best for the client.

  • The insurer's investment strategy
  • What determines the participation rate
  • Point-to-point and high/low water mark indexing
  • Annual reset, multi-year, and digital indexing
  • Positioning the product and contract evaluation

Module V - Contract Structuring and Marketing

Contracts are either annuitant- or owner-driven, regardless of the type or issuer. Determining what party should act in what capacity has significant ramifications. Comparisons between CDs, mutual funds, and insurance is common, but rarely done properly.

  • What drives the contract
  • Mutual funds vs. annuities vs. life insurance
  • Estate planning, gifting, and exchanges
  • 22 different contract structures and consequences
  • 34 reasons to like annuities plus marketing ideas

Module VI - Asset Allocation Fundamentals

Regardless of the agent or practitioner, comprehending the proper role of annuities in a financial and estate plan is crucial. Annuities can be the anchor of the portfolio or a vehicle that allows for greater risk and reward potential with downside protection.

  • Risk/return trade-off and measurement
  • Asset classes and allocation principals
  • Asset correlation and application
  • Efficient frontiers and portfolios
  • Investors goals and asset allocation models

CAS Frequently Asked Questions

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Q: What is the cost and what does it include?
A: The $1,165 fee covers everything - registration, materials, shipping, handling, and testing.

Q: How long does it take to complete the certification program?
A: Students are given 12 months to complete the program, but the vast majority of the enrollees complete the materials within a couple of months.

Q: What are the requirements for certification?
A: There are four requirements for certification: (1) pass three multiple-choice exams; (2) complete an open-book case study (see below); (3) fill out a registration form and complete a student questionnaire; and (4) sign a code of ethics.

Q: What is the final exam and where do I take it?
A: The final is a single exam of 100 multiple-choice questions. The Exam is taken at a Prometric Center. These centers are located throughout the country. If it is inconvenient for you to go to a testing center (e.g., too many miles away, disability, trouble logging onto the system, etc.), a proctored exam can be taken in your office. There is no charge to take an office exam, but the proctor you select must be a branch manager or compliance officer.

Q: What is the passage rate on the exam(s)?
A: Approximately 75%. Students who fail the exam can pay a $75 re-exam fee. If necessary, the final test can be taken multiple times.

Q: What if I do not pass or take the test(s) within the 12-month time frame?
A: You can pay $40 for a three-month extension. Multiple extensions can be purchased for a total of 2years from time of enrollment.

Q: What is the "open-book case study" requirement?
A: The case study is a half to a one page set of facts based on a hypothetical client. The response must be typewritten or word processed and less than two pages in length.

Q: Are there any ongoing or CE requirements?
A: Yes. After being a designee for one year, you must complete 15 hours of continuing education, reported once every two years. Designees have a wide range of topics and methods to choose from (e.g., attending seminars, reading books, completing other courses, teaching, writing articles, etc.).

Q: Do I get anything for my $100 annual registration fee?
A: Yes. Students and existing designees will receive the IBF Desk Reference. This 6bs for various sectors and investment vehicles such as individual securities, mutual funds, and variable annuities, plus more. The IBF Desk Reference is an expanded version of what IBF used to sell several years ago for $250 annually (and that version was not in color). Designees will be sent updated 4-color replacement pages for all 120+ charts, graphs, and tables each year. The designee does not pay for the binder, the120+ pages, or the annual updates.

Q: Do I get anything else?
A: Yes. You are entitled to a 50% subscription discount to The Wall Street Journal and/or Barron's. A one-year subscription to the Journal costs a little over $200. Our students pay less than half that amount. The savings are similar for Barron's. You can also save on PC or Mac software. We have made a deal with the largest distributor of computer hardware and software. Virtually any software you need can be purchased at a substantial discount. As an example, the most current version of Microsoft Office costs $350 at Staples or Office Depot. IBF students and graduates can purchase this software for $150.

Q: Does the program fulfill CE requirements for licenses or other designations?
A: This program fulfills CE requirements for CFP, CLU, ChFC and a number of other designations. Please contact our offices at (800) 848-2029 to find out if this program will meet the Insurance or Securities CE requirements for your state.

Q: Are there group or corporate enrollment discounts?
A: Yes groups receive a discount. Contact our corporate accounts department by sending an email to IBF or calling (800) 848-2029.