Annuities✓ Verified · outline & fact-checked · Sep 2026Difficulty 1/5
An annuity payout option that guarantees income for life, but with payments continuing for a minimum number of years even if the annuitant dies early, is called:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Life with period certain pays income for the annuitant's lifetime but guarantees a minimum number of payments (e.g., 10 or 20 years). If the annuitant dies before the period ends, the remaining payments go to a beneficiary. This reduces the risk of 'losing' the contract by dying early — at the cost of a slightly lower payment than straight life.
Why the other options are wrong
- B) Straight life pays only for the annuitant's lifetime with no minimum guarantee — payments stop at death.
- C) Period certain only pays for a fixed period with no lifetime guarantee — not a life-contingent option.
- D) Joint and survivor pays over two lives (often spouses), continuing until the second dies.
Memory hook
Life with period certain = income for life, with a 'floor' of guaranteed years. You cannot outlive it, and your heirs cannot be shortchanged by an early exit.