If you are the annuitant under a First Choice annuity contract and die before annuity payments begin, your beneficiary will receive a death benefit equal to the greater of:
- The annuity's accumulation value, or
- The total of all purchase payments contributed to the annuity (less any surrenders and surrender charges)
When a death benefit is paid to the beneficiary it is taxable as ordinary income to that beneficiary to the extent that earnings exceed the purchase payments. Death benefit payments are not subject to surrender charges. The death benefit should not be the primary reason for purchasing an annuity. If you are interested in providing a death benefit for your beneficiary you should explore your life insurance options.