Fixed Amount Option describes which of the following?

Fixed Amount Option describes which of the following?

• A. an option paying a fixed amount for an approximate length of time after principal and interest are exhausted
• B. an option for a lifetime income with variable payments
• C. an option guaranteeing a minimum death benefit
• D. an option that pays a single lump sum

Answer: (A)

The fixed amount option is a payout method where you receive a set dollar amount each payment, for a described span of time, as long as the contract value supports it. Payments continue at that fixed amount until the principal and any earned interest are exhausted, at which point payments stop. This is different from getting payments for life, which would be the lifetime income option, or taking a single lump sum, or having a guaranteed death benefit. So the description of paying a fixed amount for an approximate length of time after the funds are exhausted best fits this option.

The fixed amount option is a payout method where you receive a set dollar amount each payment, for a described span of time, as long as the contract value supports it. Payments continue at that fixed amount until the principal and any earned interest are exhausted, at which point payments stop. This is different from getting payments for life, which would be the lifetime income option, or taking a single lump sum, or having a guaranteed death benefit. So the description of paying a fixed amount for an approximate length of time after the funds are exhausted best fits this option.