Difference between Annuitant and Beneficiary

An annuity is a financial product that comes with several advantages, such as interest accumulation, financial security, and wealth accumulation. Although annuities look like simple investments at the first glance, learning all the ins and outs of the contract may be challenging. Owner, annuitant, and beneficiary are all phrases that might be easily misunderstood, simply due to the fact that they are often used interchangeably even by those from the profession itself. However, their behavior changes when applied to annuities.

Who is an Annuitant?

An annuitant is a person who, under the terms of an annuity contract, is guaranteed to receive a stream of payments at regular intervals for a certain length of time. An annuitant can be either a spouse or someone else entirely; there is no limit to the number of persons who can be included. Having said that, a trust or corporation cannot be an annuitant. Also, to become eligible as an annuitant, one must first buy an annuity for oneself.

For instance, if a husband buys an annuity for his son, the kid would be the annuitant while the husband's wife would be the beneficiary. If the son were to pass away, his widow would be responsible for collecting the income and making the necessary tax payments.

Who is a Beneficiary?

An owner of an annuity has the ability to select beneficiaries whose participation is contingent upon either the death of the annuitant or the owner. Additionally, the owner has the ability to alter the beneficiary whenever he or she sees fit, and there might be one, two, or even more beneficiaries. Even while children under the age of majority can be selected as beneficiaries, they are not eligible to receive the inheritance until they attain adulthood.

The stepped increased death rider benefit, the normal death benefit, and the return of premium are all examples of beneficiary alternatives available with annuities.

Difference − Annuitant and Beneficiary

Both benefit from the owners’ annuity. The following table highlights the difference between an Annuitant and a Beneficiary:

Characteristics Annuitant Beneficiary
Definition An individual who has entered into an annuity contract and is afterward entitled to receive regular periodic payments for a certain amount of time is referred to as an annuitant. A person who is designated to receive the benefits of an annuity in the event that the annuitant passes away is referred to as the beneficiary.


An annuitant is a person who is on the receiving end of regular monthly payments from an annuity contract over the course of a certain amount of time, whereas a beneficiary is the one who is on the receiving end of annuity benefits in the event that the annuitant passes away.

Updated on: 06-Dec-2022


Kickstart Your Career

Get certified by completing the course

Get Started