11.2b

Question 1

Once specified date set for the interest-only option has ended, the policy’s face amount is ______ and distributed to the beneficiary as either a lump-sum payment, or through one of the available installment-based settlement options.

Answer 1

removed from the trust

Question 2

The ______ is defined by the period of time in which death benefit proceeds are paid to the beneficiary. Under this option, installments are composed of both the policy’s face amount and earned interest, the amount of which is determined by the length of time in which payments are to be made to the policy’s beneficiary.

Answer 2

fixed-period option

Question 3

In comparison to the fixed-period option which pays out a policy’s death benefit proceeds and accumulated interest over a pre-determined fixed period time, under the ______ option, the amount of each installment is fixed and is continually paid to the policy’s beneficiary until the policy’s proceeds are exhausted. The period of time in which this occurs is dependent on the designated amount of each payment chosen by the beneficiary.

Answer 3

fixed-amount

Question 4

Both the fixed-period and fixed-amount options are based on the ______ relative to the period of time in which installments are paid to the policy’s beneficiary. Under the fixed-period option, the longer the payout period, the lower the installment payment, and vice versa. Similarly, under the fixed-amount option, the lower the installment payment, the longer the payout period, and vice versa.

Answer 4

amount per installment payment

Question 5

Under the ______, installments are paid to the policy’s beneficiary throughout the entirety of his or her life through the purchase of a single payment immediate annuity funded by the death benefits of the life insurance policy. This annuity is simply a stream of income payable to the beneficiary over the remainder of the beneficiary’s lifetime.

Answer 5

life income option