Insurance Licensing Virginia Life, Annuities, and Health Insurance Examination Series 11-01 Virginia-Life-Annuities-and-Health-Insurance Question # 121 Topic 13 Discussion
Insurance Licensing Virginia Life, Annuities, and Health Insurance Examination Series 11-01 Virginia-Life-Annuities-and-Health-Insurance Question # 121 Topic 13 Discussion
An immediate annuity (C) begins payments shortly after a single premium is paid, lacking an accumulation period (the phase where funds build up, typical in deferred annuities).
Option A (installments) applies to deferred annuities. Option B (lump sum) is not standard; annuities pay periodically. Option D (tax-deductible) is false; contributions are not deductible unless part of a qualified plan, not typical for immediate annuities.
The Virginia study guide defines an immediate annuity as one purchased with a single premium, with payments starting within one year, bypassing an accumulation phase. Reference: Virginia Life, Annuities, and Health Insurance study guide, section on "Annuities."
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