What are the main elements that structure and design an annuity?

The correct answer emphasizes two critical components of annuities: the funding method and the payout period.

The funding method refers to how the annuity is financed, which can involve a single premium payment or multiple installments over time. This aspect is crucial because it influences how much money is available for investment and ultimately affects the annuity's value and benefit to the policyholder.

The payout period indicates when the annuity will start to disburse payments to the annuitant and for how long those payments will continue. This can range from a fixed period to the lifetime of the annuitant, which significantly impacts the financial planning of individuals by determining the timing and structure of retirement income.

Understanding these two elements helps individuals make informed choices about their retirement plans and ensures they select an annuity product that aligns with their financial needs and goals.