What is single life annuity?

A single life annuity is a type of annuity contract that provides a series of payments to the annuitant for the rest of their life. This type of annuity does not provide payments to any beneficiaries after the annuitant passes away, hence the term "single life."

Single life annuities are typically purchased with a lump sum payment, and the annuitant can choose to receive payments for the rest of their life or for a specified period of time. The amount of each payment is determined by various factors including the annuitant's age, gender, the amount of the initial investment, and the terms of the annuity contract.

One of the main benefits of a single life annuity is that it provides a guaranteed source of income for the annuitant for the remainder of their life, regardless of how long they live. However, a potential downside is that there is no option to provide payments to beneficiaries after the annuitant passes away.

It is important for individuals considering a single life annuity to carefully review and understand the terms of the contract, as well as to consider their overall financial situation and goals before making a decision. Consulting with a financial advisor can also be helpful in determining if a single life annuity is the best option for an individual's needs.