Settlement Options Of Life Insurance Contracts

The majority of life insurance policies pay the proceeds to the beneficiary in a lump sum unless either the policyholder or the beneficiary selects an optional mode of payment. If the policyholder selects a settlement option, the beneficiary cannot change it. On the other hand, if the policyholder has not specified an option, the beneficiary is permitted to select one as an alternative to receiving the lump sum payment. The most common settlement options are presented below.