At what point does a deferred annuity beneficiary receive any benefits under the contract?

A deferred annuity beneficiary receives benefits under the contract at the death of the owner or annuitant before annuitization. In this scenario, if the annuitant passes away before the annuity payments start, the designated beneficiary is entitled to receive the death benefit. This generally includes the account value or the total premiums paid, depending on the terms of the annuity contract itself and any minimum guarantees that may apply.

This timing is important, as it differentiates deferred annuities from immediate annuities. Deferred annuities accumulate value over time and have a designated period during which the annuitant can choose to activate payments. If the annuitant dies before this activation, the death benefit provisions kick in, ensuring that the beneficiary receives any value built up in the contract. The other options relate to scenarios like post-annuitization benefits or surrendering the annuity, which do not apply to the timing of benefit distribution before annuitization.