Simple English definitions for legal terms
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A life-income period-certain annuity is a type of annuity that guarantees a specified number of payments, even if the annuitant dies before the minimum amount has been paid. An annuity is an obligation to pay a stated sum, usually monthly or annually, to a stated recipient. These payments terminate upon the death of the designated beneficiary.
For example, suppose John purchases a life-income period-certain annuity that guarantees payments for 10 years. If John dies before the 10-year period is up, his beneficiary will continue to receive payments until the end of the 10-year period. This type of annuity provides a level of security for the annuitant and their beneficiaries.
Life-income period-certain annuities are often used as a retirement income source. They provide a guaranteed income stream for a specified period, which can help retirees plan their finances.