DEFINITION of 'Annuity Certain'

A financial instrument that provides a stream of payments, for a predetermined number of years. An annuity certain will continue a stream of payments remitted to the annuitant's beneficiary or estate, if the annuitant dies before the payment term ends. The payments are made on a regular schedule, such as monthly, quarterly, semiannually or annually.

BREAKING DOWN 'Annuity Certain'

In contrast, a life annuity remits a stream of payments to the annuitant for the duration of his or her life, rather than ending on a predetermined date. If the life annuity's guaranteed period has not expired at the time of the annuitant's death, however, the annuity will continue to make payments to the annuitant's beneficiary or estate, until the guaranteed period ends.

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