An immediate annuity is considered to be an annuity contract that will be purchased with a lump sum payment and in exchange this annuity will pay a guaranteed income immediately. An immediate annuity is usually best for those retirees that may be worried about outliving their savings. An immediate annuity is considered to be permanent once you have purchased it and the immediate annuity is terminated upon your death. An immediate annuity is much like a life insurance policy, but with this annuity you give your insurance company a lump sum of money and then they will make income payments to you until you die. There are many choices for an immediate annuity and it is best to work with you insurance representative to find out what is best for you in your retirement years.