Refund Annuity Law and Legal Definition

Refund annuity means an annuity policy that guarantees payments equal to the premiums paid, upon the annuitant death. Generally, a refund annuity promises to pay during the annuitant's life, a set amount annually. In situations where the annuitant dies before receiving payments for the full amount of the annuity, the annuitant’s estate will be paid a sum that is the difference between the purchase price and the total payment’s received during the annuitant's lifetime. A refund annuity is also called as a cash refund annuity.