Question 70

Life only is the annuity payout option that has no additional payouts regardless of when the annuitant dies.

The life only annuity payout option provides payments solely during the lifetime of the annuitant. Once the annuitant passes away, no further payments are made, regardless of when that occurs.

A) Life only.

This option is correct because it specifically states that payments cease upon the annuitant's death, with no additional payouts to beneficiaries or others. It emphasizes that the financial obligation of the insurer ends with the life of the annuitant.

B) Cash refund.

The cash refund option is incorrect as it typically provides a guarantee that if the annuitant dies before receiving a certain amount of money, the remaining balance will be paid out as a lump sum to beneficiaries. This means that there are additional payouts based on the annuitant's lifespan.

C) Life certain.

This option is also incorrect because a life certain annuity guarantees payments for a specified period, regardless of whether the annuitant is alive or deceased during that time. If the annuitant dies before the end of the specified period, payments continue to beneficiaries until the period concludes.

D) Installment refund.

The installment refund option is incorrect as well, as it ensures that if the annuitant passes away before receiving a total amount equal to the purchase price of the annuity, the remaining funds are paid out in installments to the beneficiaries. This provides additional payouts contrary to the definition of life only.

Conclusion

Life only is the definitive choice because it does not provide any further payments once the annuitant dies, aligning perfectly with the question's criteria. Other options, such as cash refund and life certain, inherently include provisions for additional payouts, making them unsuitable answers.