What Is The Death Benefit Of An Index Annuity

Shawn Plummer

CEO, The Annuity Expert

What Is The Death Benefit Of An Index Annuity

The death benefit of an index annuity typically includes a standard lump sum payment. This means that upon the death of the annuity holder, the designated beneficiary receives a sum equal to the value of the annuity contract or a specified amount detailed in the contract.

Some index annuities also offer an enhanced death benefit option, which may provide additional value over the standard amount. This enhanced benefit can be structured to be paid out over a series of payments, offering a stream of income to the beneficiary instead of a single lump sum.

The specific terms and options vary by contract and issuing insurance company.

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Key Features of Index Annuity Death Benefits

  1. Standard Lump Sum Benefit: The beneficiary receives a one-time payment equal to the contract value or a predetermined amount.
  2. Enhanced Death Benefit: Additional value over the standard amount, potentially increasing the payout for the beneficiary.
  3. Payment Options:
    • Lump sum: A single payment.
    • Series of payments: A structured payout over a period.
  4. Contract Terms: Specifics depend on the annuity contract and the insurance company.
  5. Beneficiary Designation: The annuity holder can name one or multiple beneficiaries.


Understanding the death benefit options of an index annuity is crucial for effective financial planning. These benefits provide security for beneficiaries, either as a lump sum or through structured payments. Each annuity contract has unique features and terms, making it important to review these carefully. Contact us today for a free quote.

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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