Pennsylvania Life and Health Insurance Exam Practice Question
The principal use of an annuity is to provide
Correct Answer: C
Rationale: Annuities are primarily designed to provide a steady stream of income, particularly during retirement. This makes option C the most fitting choice, as retirees often rely on annuities to ensure financial stability in their later years.
Option A, while relevant, is too specific; annuities can fund various expenses, not just education. Option B is incorrect because, although annuities can support disabled individuals, their main purpose is broader than just this scenario. Option D is misleading; while some annuities might offer long-term care benefits, this is not their primary function. Thus, the focus on retirement income underscores the fundamental role of annuities.
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