What makes a straight life annuity unique?

What makes a straight life unique is that, once the annuitant dies, all payments stop and no more money or death benefits are due to the annuitant, their spouse, or heirs. This has the effect of making the straight life annuity less expensive than many other types of annuities and retirement income products.

How do annuities work?

Annuities are a type of insurance contract designed to turn your balance into future income. You can buy an annuity with a single lump sum payment or through many small payments over time. The annuity may then grow your balance, according to the type of annuity you choose.

How do you buy a straight life annuity?

A straight life annuity policy may be bought over the course of the annuitant's working life by making periodic payments into the annuity, or it may be purchased with a single lump-sum payment. Usually, lump-sum purchases are made at, or shortly after, the annuitant's retirement. Either payment option will result in the same regular payments.