Rebating in life insurance refers to the practice of providing clients with financial incentives, benefits, or inducements that are not explicitly outlined in the insurance policy. This unethical practice involves offering clients something of value, such as cash, gifts, or special favors, with the intention of influencing them to purchase a life insurance policy from a particular agent or company. Rebating is generally considered illegal in the insurance industry as it undermines fair competition and violates the principles of transparency and integrity.

Insurance regulators and industry associations strictly prohibit rebating to maintain a level playing field among insurance agents and companies. The primary goal is to ensure that consumers make insurance decisions based on the merits of the policy itself and the insurer's reputation, rather than being swayed by unauthorized incentives. Rebating can distort the market and create an environment where consumers may not fully understand the terms and conditions of their policies, potentially leading to unsuitable coverage choices.

Insurance professionals are expected to adhere to ethical standards and conduct business with honesty and transparency. Violating anti-rebating laws and regulations can result in severe consequences, including fines, license revocation, and damage to professional reputations. To protect consumers and maintain the integrity of the insurance industry, it is essential for insurance agents and companies to refrain from engaging in or promoting any form of rebating. Clients are encouraged to be aware of their rights and report any instances of rebating to the appropriate regulatory authorities.

The life insurance settlement option that guarantees payments for the lifetime of the recipient is commonly known as a "Life Annuity" or "Life Income" option. This arrangement provides the beneficiary with a regular stream of income for the entirety of their life, offering financial security and stability. Under this option, the life insurance company commits to making periodic payments to the beneficiary until their death, regardless of how long they live.

The amount of each payment is determined by factors such as the policy's cash value, the beneficiary's age, and the specific terms outlined in the policy. Opting for a Life Annuity settlement ensures that the beneficiary has a reliable source of income, making it an attractive choice for those seeking long-term financial protection and a guaranteed stream of funds throughout their lifetime.