Life · Chapter 9 · Premium & Timing Classes
Immediate Annuity (SPIA)
Definition
Income begins as soon as 30 days after purchase and no later than 12 months. Can ONLY be funded with a single premium, so there is no accumulation period. Best for someone who needs income now — a retiree or a disabled person.
In plain English
Hand over the lump sum, start collecting the paycheck next month.
Exam tip
Immediate annuity = single premium + income within the first year. Don't overthink it — periodic-premium annuities can't be immediate.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms