New York State Life Insurance Exam Questions Practice Question
The settlement option that allows proceeds to remain with the insurer and the earnings to be paid to the beneficiary on a monthly basis is called
Correct Answer: A
Rationale: The interest-only option allows the insurance proceeds to stay with the insurer, providing monthly payments to the beneficiary based on the interest earned. This ensures a steady income while the principal remains intact.
Option B, lump sum, involves a one-time payment of the entire benefit, which does not provide ongoing support.
Option C, fixed period, pays out the principal over a specified timeframe, but does not retain the funds with the insurer for interest accumulation.
Option D, fixed amount, distributes a set amount periodically until the principal is exhausted, lacking the benefit of interest earnings.
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