Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?

• A. Joint and survivor
• B. Life with period certain
• C. Fixed period
• D. Life income

Answer: (D)

In annuity settlement options, the pay-out that goes only to the person who purchased the annuity, for as long as they live, with nothing left for a beneficiary, is the straight life or life income option. It guarantees a monthly (or other period) payment for the annuitant’s lifetime, and once the annuitant dies, payments stop with no residual value or death benefit paid to a beneficiary.

Why the other options don’t fit: Joint and survivor continues payments to a second person after one dies, often with a reduction after the first death, so there is a surviving beneficiary. Life with period certain guarantees payments for life but ensures a minimum period to a beneficiary if death occurs early, creating a residual value. Fixed period guarantees payments for a set term and typically leaves something for a beneficiary if the annuitant dies before the term ends.