Life Annuity with Period Certain includes which feature?

• A. Is funded by monthly premiums
• B. Pays only until the annuitant dies, with no beneficiary
• C. Pays the highest monthly income possible for life
• D. Guarantees income for a specified period (e.g., 10-20 years) regardless of survival, then continues to a named beneficiary after death

Answer: (D)

A life annuity with period certain guarantees a minimum number of payments. If the annuitant dies before the end of that guaranteed period, the remaining payments are made to a named beneficiary for the rest of the period. If the annuitant survives past the end of the period, the payments continue for life to the annuitant (and there’s no further beneficiary continuation beyond that point). This structure protects a beneficiary if death occurs early while still providing lifetime income to the annuitant. The option that describes guaranteeing income for a specified period and then continuing to a beneficiary for the rest of that period matches this feature exactly. The other statements don’t describe the period-certain protection or the beneficiary continuation aspect.