Question

Elizabeth is the beneficiary of a life insurance policy. She is receiving the death benefit in payments of $10,000 per month until the principal and interest has been paid out. Which option was chosen?

A. Fixed period
B. Fixed amount
C. Life income
D. Interest only

Answer 1

Elizabeth chose the B. fixed amount option for the death benefit of a life insurance policy, receiving $10,000 monthly until the total benefit is paid out.

Step-by-step explanation:

Elizabeth is receiving the death benefit of a life insurance policy in fixed amount payments of $10,000 per month until the principal and interest has been paid out. This payout option, known as the fixed amount option, allows beneficiaries to receive a specified amount of money on a regular basis from the policy until the entire death benefit has been disbursed.

It's important to note that other types of payout options exist, such as fixed period, life income, and interest only, each with different characteristics suiting varying needs of beneficiaries.