Stan paid an insurance company $50,000 for a fixed annuity when he was 50 years old.At age 62,Stan plans to begin to receive payments from the insurer.There are no guarantees on the number of payments he will receive.Based on the description provided,this annuity can be described as a(n)

Question

Quizplus · Accepted Answer

Stan paid for a fixed annuity at age 50, but he will not begin receiving payments until age 62, which means it is a deferred annuity. There are no guarantees on the number of payments he will receive, which rules out a life annuity with guaranteed payments. It is not an immediate annuity because Stan will not begin receiving payments right away. It is also not a variable annuity because there is no mention of any investment options within the annuity.

Stan Paid an Insurance Company $50,000 for a Fixed Annuity