Which annuity option guarantees payments for a specified period regardless of survival?

Which annuity option guarantees payments for a specified period regardless of survival?

• A. Life Income (Pure or Straight Life)
• B. Life Income with Refund (Installment or Cash Refund)
• C. Life Income Joint & Survivor
• D. Annuity Certain

Answer: (D)

The key idea is a payout that isn’t tied to how long you live, but to a fixed time frame. An Annuity Certain guarantees a set number of payments, such as 10 or 20 years, and those payments continue for the entire term regardless of whether the annuitant is alive to receive them. If the owner dies before the term ends, the remaining payments typically pass to a beneficiary or are paid out as specified in the contract. This contrasts with life-based options, where the payments depend on the annuitant’s survival: life income ends at death, life income with refund guarantees lifetime payments with a refund if death occurs early, and joint & survivor pays while both spouses are alive or provides survivor payments after one dies. The fixed-term nature of Annuity Certain makes it the choice that ensures payments for a defined period no matter what.

The key idea is a payout that isn’t tied to how long you live, but to a fixed time frame. An Annuity Certain guarantees a set number of payments, such as 10 or 20 years, and those payments continue for the entire term regardless of whether the annuitant is alive to receive them. If the owner dies before the term ends, the remaining payments typically pass to a beneficiary or are paid out as specified in the contract. This contrasts with life-based options, where the payments depend on the annuitant’s survival: life income ends at death, life income with refund guarantees lifetime payments with a refund if death occurs early, and joint & survivor pays while both spouses are alive or provides survivor payments after one dies. The fixed-term nature of Annuity Certain makes it the choice that ensures payments for a defined period no matter what.