Questions: Lumen OHM 508 ities / Chapter Quiz Question 10 of 15 The main difference between immediate and deferred annuities is A. When the income payments begin. B. The number of insureds. C. How the annuity is purchased. D. The amount of each payment.

The answer is A: When the income payments begin.

Explanation for each option:

A. When the income payments begin. - This is the correct answer. The primary distinction between immediate and deferred annuities is the timing of when the income payments start. Immediate annuities begin payments almost immediately after a lump sum is paid, typically within a year. Deferred annuities, on the other hand, start payments at a future date, allowing the investment to grow over time.

B. The number of insureds. - This is incorrect. The number of insureds is not a defining factor between immediate and deferred annuities. Both types of annuities can be structured for single or multiple insureds.

C. How the annuity is purchased. - This is incorrect. Both immediate and deferred annuities can be purchased with a lump sum or through a series of payments, so the method of purchase does not differentiate them.

D. The amount of each payment. - This is incorrect. While the amount of each payment can vary between different annuities, it is not the main difference between immediate and deferred annuities. The key difference is the timing of the payments.

In summary, the main difference between immediate and deferred annuities is when the income payments begin.