YOU ASK:

What is the definition of Separate Account?

WE ANSWER:

A Separate Account refers to an investment account that the insurance company maintains as separate from its general account. The separate account is used for the insurance company's investment activities. These include funds from variable annuities or variable insurance products that have to be invested in order to get a return.

These funds are kept separate in order to distinguish it from the insurance company's own money (the general account). Keeping the distinction helps prevents misuse of funds from both sides - the insurance company does not use the general funds for investments and it does not use the separate account to fund the company's day-to-day operations.

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