What does a "life insurance policy annuity" provide to the policyholder?

A life insurance policy annuity provides a series of regular payments made typically during retirement. This financial product is designed to help policyholders manage their income in retirement by converting a lump sum of money—such as those accumulated in a life insurance policy—into periodic payments. This ensures a steady income stream that can help cover living expenses for the policyholder over an extended period, typically until their death.

This structure is particularly beneficial for individuals who may be concerned about outliving their savings, as it provides them with a reliable source of income. Additionally, annuities can be tailored to meet the specific needs of the policyholder, including factors like the duration of payments and the amount received. The focus on retirement income distinguishes this option from others that may provide different types of financial benefits.