A life contingency option is an annuity payout option that provides a death benefit in case the annuitant dies during the accumulation stage. The terms and features of the life contingency option will vary from contract to contract.
SecuritiesCE Explains Life Contingency
Deferred annuities are typically long term contracts established under a period payment plan. During this time the annuitant is making regular payments into the contract to accumulate value. The value will be used to create an income payment stream later in life, traditionally after retirement. Certain annuity contracts will offer a life contingency option which will in many cases be used to fund the contract completely to create a payment stream to the annuitant’s beneficiaries.