Question 57

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

The life only annuity payout option guarantees payments for the lifetime of the annuitant, with no further payouts to beneficiaries if the annuitant passes away. This means that once the annuitant dies, the payments cease, regardless of how long they have been receiving them.

A) Life only.

This option is correct because it specifies that payments are made only during the lifetime of the annuitant. Once the annuitant passes away, there are no remaining payouts, which aligns with the question's criteria of having no additional payouts regardless of the timing of death.

B) Cash refund.

The cash refund option is incorrect because it provides a guarantee that, if the annuitant dies before receiving payments equal to the initial investment, the remaining funds are returned to the beneficiary. This means there are additional payouts available beyond the life of the annuitant.

C) Life certain.

This option is incorrect as well. A life certain annuity guarantees payments for a specified period, even if the annuitant dies. If the annuitant passes away before the end of this period, payments continue to the beneficiary, providing additional payouts which contradict the question's requirement.

D) Installment refund.

The installment refund option is also incorrect. It ensures that if the annuitant dies before receiving the total amount of the annuity in payments, the remaining balance is paid out to a beneficiary in installments. This clearly means that there are additional payouts available beyond the lifetime of the annuitant.

Conclusion

The life only option is definitively correct as it fulfills the requirement of ceasing payments entirely upon the annuitant's death, with no further payouts to beneficiaries. All other options provide some form of additional payout, either through refunds or continued payments, which disqualifies them from being the correct answer.