In a fixed-period settlement option, how is the amount of each installment determined?

In a fixed-period settlement option, the amount of each installment is determined by dividing the total death benefit or accumulated value by the number of periods over which the payments will be made. Therefore, if the selected period is longer, the total amount is spread over more installments, which results in each installment being smaller. Conversely, a shorter period means that the total amount is divided into fewer payments, which leads to higher individual installment amounts.

Thus, the relationship between the period length and the size of each installment is inversely proportional: the longer the settlement period, the smaller each installment will be. This reflects the principle that the total payout remains constant, and the duration of payment affects how much is paid out in each installment.