Definition - What does Survivorship Annuity mean?
A survivorship annuity is a combined life insurance and annuity that provides a lifetime income to the surviving beneficiary. The policyholder pays a regular premium, and upon their death, the survivor receives a monthly income for life, instead of a lump sum death benefit.
It is also known as a reversionary annuity.
Insuranceopedia explains Survivorship Annuity
Should the beneficiary die before the policyholder, the contract becomes void, and no benefits are paid. Moreover, because the premium is based on the life expectancy of the policyholder and the beneficiary, the latter cannot be changed. Due to this, the premiums tend to cost around the same as term life policies as opposed to permanent ones. Therefore, a survivorship annuity represents a more affordable option for older individuals.