What is guaranteed minimum death benefit

Guaranteed Minimum Death Benefit (GMDB) is a provision added to an annuity for payment of an additional benefit in case the policy loses value. This would allow the insured's beneficiary to receive a guaranteed amount.

What is minimum guaranteed benefit?

A guaranteed minimum income benefit (GMIB) ensures that an annuitant will receive payments regardless of market conditions. This minimum payment amount is predetermined by assessing the future value of the initial investment. This option is only beneficial to annuitants who plan to annuitize their annuity.

What is the guaranteed minimum death benefit on a variable annuity?

Most, but not all, variable annuity contracts provide a standard Guaranteed Minimum Death Benefit (GMDB) during the accumulation period equal to the greater of (a) the contract value at death or (b) premium payments minus any prior withdrawals.

What is the most common payout of death benefits?

Lump sum: The most common option is to receive the death benefit in one lump sum. You can either receive a check for the full amount or have the money wired into a bank account electronically.

What is a guaranteed living benefit?

The living benefit—as the name suggests—is intended to guarantee the benefit provided, and toward that end, it usually offers guaranteed protection of the principal investment and the annuity payments or guarantees a minimum income over a specified period to you and your beneficiary.