Life · Chapter 6 · Settlement Options
Fixed Period Option
Definition
Proceeds + interest paid in equal installments over a set number of years (no life contingency). The face amount and the chosen period determine the payment size.
Example
Income until all the children graduate — a definite period is the priority.
Exam tip
Fixed PERIOD: the time is fixed, the payment amount follows. Fixed AMOUNT: the payment is fixed, the time follows.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms