What effect does the longer selected period have on payments in a fixed-period settlement?

In a fixed-period settlement option, the total benefit amount is distributed over a specified time period. When the selected period lengthens, the total amount is divided by a larger number of payment periods. As a result, the payment received during each period decreases. This is because the same total amount is being allocated over an extended duration, making each individual payment smaller. Therefore, the longer the selected period, the smaller the amount of each payment will be, leading to a decrease in payment amounts. This understanding is crucial for policyholders to grasp the financial implications of their choices regarding settlement options.