Annuity (private Rentenversicherung)

Under German law, an annuity (private Rentenversicherung) is defined as a contract between a buyer (Versicherungsnehmer) and an insurance company (Versicherung) under which the buyer makes a single or multiple/periodic payment and in return the insurance company pays out a certain amount at a certain point in time or partial amounts at intervals. As a rule, a death benefit or continued payment to a surviving dependant (e.g., to the widow or children) is also agreed. However, unlike life insurance, this is not typical. In the case of a variable annuity (fondsgebundene Rentenversicherung), the value depends on the performance of the investment fund on which the annuity insurance is based.  The term "annuities" as used in this Art. 18(2) of the Germany U.S. Income Tax Treaty means a stated sum paid periodically at stated times during a specified number of years, under an obligation to make the payments in return for adequate and full consideration (other than services rendered).