Single payment deferred annuity (SPDA) is defined as which of the following?

Single payment deferred annuity (SPDA) is defined as which of the following?

• A. A deferred annuity created with a single purchase payment
• B. A life insurance policy with a level premium
• C. An annuity that pays for life only
• D. A single payment deferred annuity

Answer: (D)

A Single Payment Deferred Annuity is defined by two key features: it is funded with one lump-sum premium and the payout is delayed to begin after a deferral period. This combination is precisely what the term “single payment deferred annuity” describes. The other options describe products that aren’t SPDA: a life insurance policy with level premium is not an annuity, and a payout that lasts for life is a different payout option rather than the single-premium, deferral structure. The description that uses the exact term single payment deferred annuity matches the standard definition most directly.

A Single Payment Deferred Annuity is defined by two key features: it is funded with one lump-sum premium and the payout is delayed to begin after a deferral period. This combination is precisely what the term “single payment deferred annuity” describes. The other options describe products that aren’t SPDA: a life insurance policy with level premium is not an annuity, and a payout that lasts for life is a different payout option rather than the single-premium, deferral structure. The description that uses the exact term single payment deferred annuity matches the standard definition most directly.