Cash Refund Annuity

Posted in Finance, Accounting and Economics Terms, Total Reads: 1205

Definition: Cash Refund Annuity

It is an annuity contract under which the funds are paid to the beneficiary if the annuitant dies before the contract expires.

Annuities are constant stream of income over a predefined period of time. So, if annuity passes away at a point of time when the total annuity paid will be less than total annuity has to be made then balance will be paid to the beneficiary by the insurance company.


A person buys an annuity for $ 200000. After receiving $120000 in annuity payments he dies. So his beneficiary would receive the balance amount (i.e. $ 80000) from the insurance company. So the beneficiary would receive a lump sum.


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