Group Life & AnnuitiesQuestion 112 of 315
By definition, a single premium immediate annuity (SPIA) must begin making payouts to the annuitant no later than:
a.One year from the date of purchase
b.Five years from the date of purchase
c.The annuitant's 59½ birthday
d.The annuitant's 65th birthday
Explanation
An immediate annuity, including a SPIA, must begin making periodic payouts within one year of purchase, which is what distinguishes it from a deferred annuity. The 59½ rule is a tax rule about early-withdrawal penalty, not a payout-start rule.
Law Reference: Cal. Ins. Code §10168.2Practice all 315 questions free — no signup required.
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