Question

All these statements concerning Settlement Options are true, EXCEPT?

a) They allow the beneficiary to choose how they receive the death benefit.
b) They can include options like lump sum, life annuity, and fixed period.
c) They are only available with whole life insurance policies.
d) They affect how the policy proceeds are paid out.

Answer 1

Settlement Options allow the beneficiary to choose how they receive the death benefit. They can include options like lump sum, life annuity, and fixed period. They are not only available with whole life insurance policies.

Step-by-step explanation:

Settlement Options allow the beneficiary of a life insurance policy to choose how they receive the death benefit. These options can include a lump sum payment, a life annuity, and a fixed period payment. However, it is not true that settlement options are only available with whole life insurance policies. They can also be offered with other types of life insurance policies, such as term life insurance.

Settlement options affect how the policy proceeds are paid out, giving the beneficiary flexibility in deciding how they want to receive the death benefit. For example, they may choose a lump sum payment if they need immediate funds, or a life annuity if they prefer a steady income stream over time.