Which settlement option can be chosen by beneficiaries?

Beneficiaries of life insurance policies often have various options for how they can receive their benefits, and one of the most common choices is to receive payments in a lump sum or in installment payments.

Choosing the lump sum option allows beneficiaries to receive the full death benefit at once, providing them with immediate access to the funds. This is particularly useful for settling immediate financial needs like funeral expenses, paying off debts, or making significant life purchases. Conversely, installment payments provide the benefit amount in smaller, periodic payments over time. This can help with budget management, ensuring that the beneficiaries have a steady income stream for a certain period.

This flexibility allows beneficiaries to select the option that best meets their financial situation and goals at the time they receive the benefit. Therefore, this option encompasses the common practices in life insurance settlements, making it the correct answer.