Just call us Bond. Amortized bond.
Over 700 finance terms, Shmooped to perfection.
Why don't they give these things a name? Like what pathos is there in a number? It makes your life miserable remembering all of them—and frankly doesn't make our life any easier writing pithy epithets about 'em either. But here we go.
A 1035 exchange is a swap. More specifically, it's a swap relating to life insurance policies or annuities. You have one annuity or life insurance policy and want to exchange it with another one (of similar value), so you use a 1035 exchange to do it.
Why, you ask? Because a 1035 exchange is tax free. Taxxxx freeeee [insert Homer Simpson drool sound].