immediate annuity


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immediate annuity

n
(Banking & Finance) an annuity that starts less than a year after its purchase. Compare deferred annuity
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24| Annuitization functions similarly to an immediate annuity.
An immediate annuity plan is a single-premium plan.
Regardless of interest rate levels, the highest contractual payout for the client and the most efficient solution for immediate income is a single premium immediate annuity (SPIA).
An immediate annuity issued by an insurance company is one of those alternatives.
Bajaj Allianz Life Insurance has introduced a non-linked immediate annuity plan called Pension Guarantee.
The firm has launched a non-linked immediate annuity plan, Pension Guarantee, which would provide the option to extend the annuity (pension) to the spouse of the person covered.
Simplicity is another advantage; a fixed immediate annuity requires no market watching or other management.
So, as more people start to buy deferred annuity plans ( where you accumulate a pension fund during working life), experts say a large number of people will opt for immediate annuity plans.
When an immediate annuity is purchased, the consumer (or annuitant) is transferring longevity and market risks to an insurance company that is more efficiently equipped to manage the risks.
PRODUCT ADVOCATE: Douglas Dubitsky, vice president in product management for the Guardian Life Insurance Company of America, spearheaded the addition of a single-premium immediate annuity to the company's product suite.
For an initial premium, an immediate annuity provides equal payments that begin immediately and last for life.
In such an arrangement, the university uses a portion of the donor's gift to purchase a single-premium immediate annuity from an insurance company.