Virginia Insurance Virginia Life, Annuities, and Health Insurance Examination Series 1101 Exam - Topic 14 Question 14 Discussion

The fixed period settlement option in life insurance, per Virginia Code 38.2-3115, pays the death benefit in equal installments over a set time (e.g., 10 years), determined by the policyowner or beneficiary if not restricted. Option B is true; a longer period spreads the principal and interest over more payments, reducing each installment (e.g., $100,000 over 20 years yields smaller payments than over 5 years). Option C is true; payments blend principal and interest earned on the remaining proceeds held by the insurer. Option D is true; Virginia law allows beneficiaries to choose settlement options unless the policyowner locks in a method (e.g., via a policy endorsement). Option A is false; the payment amount depends on the proceeds, interest rate, and period length---not the beneficiary's age, which might influence a life income option instead. The study guide likely contrasts fixed period (time-based) with life annuity (age-based) options, using examples like $500 monthly for 10 years, making A the exception.