Understanding your Life Insurance Settlement Options
AAFMAA offers six settlement options for beneficiaries of life insurance policies. For all options (except lump sum) AAFMAA guarantees a specified interest rate. If AAFMAA’s net yield on assets (NYA) exceeds the guaranteed (which has traditionally been the case), the beneficiary receives the difference between the guaranteed and the actual return achieved. That amount is paid in the “bonus check” sent May 1st each year.
At the time of death of an insured, AAFMAA issues a Settlement Options Form to explain options and ensure AAFMAA’s actions are clearly disclosed and understood by the beneficiary.