What are the methods used to pay death benefits or endowment benefits in life insurance?

The methods used to pay death benefits or endowment benefits in life insurance are known as settlement options. These options provide beneficiaries with various ways to receive the benefit payout, each tailored to meet different needs and preferences. For instance, some beneficiaries may prefer a lump-sum payment to meet immediate financial obligations, while others might choose an annuity option that provides regular payments over a set period, ensuring a stream of income.

Settlement options can include choices such as a lump-sum payment, fixed amount installments, or a life income option, which provides the beneficiary with payments for their lifetime. This flexibility helps address the unique financial situations of each beneficiary, allowing them to choose a payout method that aligns with their financial planning.

While other terms like the One-Year Term Option, Interest Only Option, and Fixed Period Option may mention ways in which benefits might be structured, they do not encompass the broader concept of various methods for settling death benefits or endowment benefits that are outlined under settlement options. Thus, settlement options serve as the overarching category that includes various specific payment methods for life insurance benefits.