If the annuitant dies before the annuity start date, what will be paid to the beneficiary?

• A. The premiums paid
• B. The premiums paid plus interest earned
• C. The death benefit equal to face value
• D. The benefits begin to accrue for the beneficiary

Answer: (B)

The key idea is that an annuity accumulates value from the premiums paid. If the annuitant dies before the annuity starts paying out, the beneficiary receives the contract’s cash value—the premiums paid plus any interest credited to the account. This protects the owner's contributions by returning them with interest if death interrupts the plan before payout begins. It isn’t just the premiums alone (which would ignore credited interest), nor a separate face-value death benefit (annuities don’t have a life-insurance-style face value), and there are no ongoing benefits accruing before the start date. So the beneficiary gets the premiums paid plus interest earned.