The period of time in a variable annuity when the owner receives payments is called what?

• A. Annuity Phase
• B. Accumulation Phase
• C. Deferment Phase
• D. Maturity Phase

Answer: (A)

In a variable annuity, there are two main phases: accumulation, when you contribute and the value grows, and the period when you actually receive payments. The period during which the owner begins to receive income is called the annuity phase. That’s the phase where the contract turns from saving into providing regular (potentially variable) income, based on the performance of the chosen sub-accounts.

The other terms don’t describe the payout period: accumulation is the saving-and-growth stage, deferment (when distributions are postponed) is not the standard name for the payout period, and maturity is not used to designate the annuity’s payout phase.