If the annuitant dies before the annuitization period starts, what will the beneficiary receive?

In the scenario where the annuitant dies before the annuitization period begins, the beneficiary is entitled to receive the greater of the cash value of the annuity or the subtotal of the payments made into the annuity. This ensures that the beneficiary is compensated fairly for the contributions made by the annuitant.

Annuities typically have a built-in provision that protects the interests of the annuitant and their beneficiaries. The cash value represents the amount that has accumulated in the annuity, while the subtotal of payments is simply the total amount the annuitant has invested up to that point. By offering whichever amount is greater, the policy safeguards against market fluctuations that might affect the cash value, thus ensuring the beneficiary receives a minimum guaranteed amount.

This approach reflects the fundamental purpose of annuities to provide financial security and a death benefit, alongside the potential for growth. It also promotes trust and reassurance for individuals investing in these products, knowing their beneficiaries will have access to funds in the event of their untimely passing prior to the annuity's activation.