Cash Refund Annuity
- A type of annuity that returns some or all of an annuity's funds if the annuitant dies before the end of the annuity contract. A cash fund annuity will pay the difference between the payments made and received by the annuitant. For example, if an individual has paid $250,000 into a cash refund annuity but has received only $100,000 before their death, the beneficiaries of the annuitant or the annuitant's estate would be entitled to the remaining $150,000. Also known as a "lump sum refund annuity."
lump sum refund annuity
Related Terms and Acronyms
- Annuity Certain — Definition,
- A type of annuity that makes payments to the annuitant for a set term; payments stop when the agreed upon term ends, even if the annuitant is still alive after the term ends.
- Annuity Contract — Definition,
- A contract that outlines each party's responsibilities as they relate to an annuity.
- Fixed Annuity — Definition,
- An annuity that makes fixed payments to the annuitant with guarantees for earnings and principal.
- Guarantee Period — Definition,
- A time period where income payments from an annuity are guaranteed.
- Joint and Survivor Annuity — Definition,
- An annuity with multiple annuitants (usually spouses) that makes payments as long as either of the annuitants are alive.
- Life Annuity — Definition,
- An annuity that will continue to make payments until the death of the annuitant.
- Refund — Definition,
- To give back, return, or repay.
- Split-Funded Annuity — Definition,
- Two annuities purchased together, one with a deferred payout and the other with an immediate payout.
- Straight Life Annuity — Definition,
- An annuity that stops all payments upon the annuitant's death.
- Substandard Health Annuity — Definition,
- An annuity with increased income payments for people with shorter life expectancies due to medical conditions.