Which annuity option provides payments that may terminate with a refund of premium either in installments or as a lump sum after death?

Which annuity option provides payments that may terminate with a refund of premium either in installments or as a lump sum after death?

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

Answer: (B)

When evaluating annuity payout options, focus on whether a refund of the premium is guaranteed after death. The Life Income with Refund option pays income for the life of the annuitant, and if death occurs before the total payments reach the original premium, the difference is refunded to a beneficiary. That refund can be provided in installments (installment refund) or as a lump sum (cash refund). This guarantees that the premium isn’t lost and is returned to the beneficiary, which is what the question describes. Other options either terminate at death without a premium refund or guarantee payments for a fixed period regardless of life, so they don’t fit the described scenario.

When evaluating annuity payout options, focus on whether a refund of the premium is guaranteed after death. The Life Income with Refund option pays income for the life of the annuitant, and if death occurs before the total payments reach the original premium, the difference is refunded to a beneficiary. That refund can be provided in installments (installment refund) or as a lump sum (cash refund). This guarantees that the premium isn’t lost and is returned to the beneficiary, which is what the question describes. Other options either terminate at death without a premium refund or guarantee payments for a fixed period regardless of life, so they don’t fit the described scenario.