If Jack and Jill both have $500,000 to fund the payment of a lifetime annuity payment, which of the following best explains differences that may occur in the determination of payouts?

Question

Quizplus · Accepted Answer

Jack will receive higher payouts as he is more likely to die before Jill. Part of the annuity process involves using age as a determination for payouts of annuities. Because a man's life expectancy is shorter than a woman's life expectancy, a man's policy will likely pay out higher. This determination has slowly been changing where some states use a unisex determination for equality.

If Jack and Jill Both Have $500,000 to Fund the Payment