Life insurance settlement options include all of the following, except:

The extended term option is not classified as a life insurance settlement option. Instead, it is typically a non-forfeiture option that allows policyholders to use the cash value of a permanent life insurance policy to purchase a term policy for a specific period. In the context of a settlement, which involves how the benefits of a life insurance policy are disbursed to beneficiaries after the insured's death, the other options (interest option, fixed amount option, and fixed period option) are all ways in which the death benefit can be structured for payment.

The interest option is where the insurer pays the beneficiary interest on the death benefit while the principal remains with the insurance company. The fixed amount option involves the insurer paying a set amount to the beneficiary until the total benefit is exhausted. The fixed period option provides payments for a specified period, ensuring a steady income stream to the beneficiary over the designated term.

Understanding these distinctions is crucial for recognizing how different settlement options operate and how they impact the beneficiaries' experience after a policyholder's passing.