What is the annuitization phase of an annuity contract commonly referred to as?

The annuitization phase of an annuity contract is commonly referred to as the payout stage. This is the period during which the insurance company begins to make regular payments to the annuitant. It follows the accumulation phase, where the funds contributed to the annuity grow over time.

During the payout stage, the method and frequency of these payments are typically outlined in the annuity contract, ensuring the annuitant receives a steady income stream. This stage can vary in length depending on the selected payout option, and it may last for a specified number of years, until the annuitant's death, or for the remainder of the annuitant’s lifetime.

Understanding this phase is crucial for managing retirement income effectively, as it transforms the accrued value of the annuity into tangible financial support for the annuitant.