19. Which of the following annuities will pay benefits for the life of two individuals, continuing until both have died?
Answer: A
Joint and survivor annuity
A joint and survivor annuity is designed to provide benefits for the lifetime of two individuals, ensuring that payments continue until both parties have passed away.
A) Joint and survivor annuity
This option is correct as it specifically refers to an annuity that guarantees payments for the lives of two individuals, continuing until the death of the second individual. This type of arrangement is particularly beneficial for couples, as it offers financial security for the surviving partner.
B) Fixed annuity
A fixed annuity provides guaranteed payments over a specified period or for the lifetime of the annuitant, but it does not typically cover two lives. Therefore, it does not fulfill the requirement of continuing payments until both individuals have died.
C) Refund annuity
A refund annuity generally provides a return of premium or an equivalent value if the annuitant dies before a certain period. This type does not ensure that benefits continue for the life of two individuals, making it an incorrect choice for this question.
D) Straight life annuity
A straight life annuity pays benefits only for the lifetime of a single individual and ceases upon their death. It does not accommodate the needs of two individuals, thus failing to meet the criteria set by the question.
Conclusion
The joint and survivor annuity is definitively the correct answer, as it is explicitly designed to provide benefits for two individuals for their lifetimes. In contrast, the other options fail to meet this requirement, either covering only one life or lacking the structure to continue payments until both individuals have passed away.