Deferred Annuities are defined as:

Deferred Annuities are defined as:

• A. Provide immediate monthly payments.
• B. Promise to pay in the future.
• C. Are always funded by a lump sum upfront.
• D. Do not provide any death benefits.

Answer: (B)

The key idea is delaying payouts. A deferred annuity collects funds and allows growth during an accumulation period, with payments starting at a future date chosen by the contract holder. That makes the defining feature the promise to pay in the future. Immediate annuities, by contrast, start payments right away, which is not what a deferred annuity does. Also, deferred annuities aren’t restricted to a single lump-sum funding approach; they can be funded with one lump sum or ongoing periodic premiums. And death benefits can be included with riders or guarantees, so it's not correct to say they never provide death benefits.

The key idea is delaying payouts. A deferred annuity collects funds and allows growth during an accumulation period, with payments starting at a future date chosen by the contract holder. That makes the defining feature the promise to pay in the future.

Immediate annuities, by contrast, start payments right away, which is not what a deferred annuity does. Also, deferred annuities aren’t restricted to a single lump-sum funding approach; they can be funded with one lump sum or ongoing periodic premiums. And death benefits can be included with riders or guarantees, so it's not correct to say they never provide death benefits.