Life with Period Certain Annuity Basics

Getting life insurance is very important for people with dependents, especially small children. There are different kinds of life insurance, and one of the most popular is permanent life insurance. If you get permanent life insurance, you will get back the money you put into your insurance policy in the form of an annuity. An annuity can be disbursed however you want it – either in one big lump sum, or in yearly payments. Should you choose to get your annuity on a yearly or monthly basis, you can add on the condition known as “life-with-period-certain.”

What is It?

A life-with-period-certain annuity is an annuity that is disbursed to you over multiple years. Should you die before those ten years are over, the life-with-period-certain annuity will continue to go to whoever you have designated as the contingent payee. That’s essentially your back-up beneficiary. So, the money from your permanent life insurance policy will continue to be paid out in the form an annuity, but it will go to the person you’ve designated. Once the years of the initial annuity plan contract are up, that’s the end of the annuity payments to the person you named as contingent beneficiary.

Advantages of Life with Period Certain Annuities

The best thing about the life-with-period-certain annuity plan is that you will more than likely get a higher annuity payment every time, seeing as all the money you’ve built up in your permanent life insurance policy – known as its cash-value aspect – has to be given back to you in a set period of time. By contrast, were you to get a life annuity plan, the cash value in your permanent life insurance policy would be paid out over many more years.

To learn more about life-with-period-certain annuity, permanent life insurance, annuities and any other aspect of a life insurance policy, be sure to consult with a life insurance professional.