Annuities serve to liquidate an estate through recurrent payments.

• A. A lump-sum payment at purchase
• B. Recurrent payments of income
• C. A one-time capital payout
• D. A contingent waiver of premiums

Answer: (B)

Annuities are designed to convert a lump sum into a steady stream of payments to the holder, typically for life or for a fixed period. This means their primary function is to provide recurrent income rather than a single upfront payout. Funding an annuity with money and then receiving payments over time helps liquidate spending needs over the future, which is why the idea of recurrent income is the best fit.

The other concepts describe different features: a lump-sum payment at purchase would end all ongoing payments after the initial outlay, a one-time capital payout isn’t an annuity, and a contingent waiver of premiums is a separate rider or feature not tied to providing a stream of income.