Definition of "Death Benefit"

The proceeds of a Life insurance policy, which are payable to the beneficiary or beneficiaries upon proof of the insured's death. Also available on some annuities. The guarantee that if you should die before you convert your variable annuity into regular income payments (annuitize your contract), your annuity's beneficiaries will receive the higher of the account value or a different amount specified in the deferred annuity (such as the amount you contributed to the annuity, less withdrawals). In many variable annuities, the death benefit can increase over time. The payment the investor's estate or beneficiaries will receive if he or she dies before the annuity matures. There are several types of death benefits with variable annuities, including: Current account value or initial investment (whichever is greater), in which the beneficiary receives the vale of the annuity when the policyholder dies; Rising floor, in which an investment company guarantees a minimum return on premium deposits, regardless of subaccount investment performance; Ratchet, a benefit equal to the greater of (a) the contract value, (b) premium payments less prior withdrawals or (c) the contract value on a specified prior date; and Stepped-up, which guarantees the account value to the beneficiary as of a particular anniversary date (e.g. every 5 years).

The amount indicated on the face of the certificate that will be paid upon the death of the insured individual.

The proceeds which the beneficiary receives upon the death of the insured as stated in the life insurance policy.