Which type of annuity allows for contributions at flexible intervals?

The option indicating a flexible premium deferred annuity is correct because this type of annuity allows the policyholder to make contributions at varying intervals and in different amounts, rather than requiring a set premium at regular intervals. This flexibility is advantageous for individuals who may want to adjust their contributions based on their financial situation or investment goals.

In a flexible premium deferred annuity, the contributions can be made as often as desired, and the funds grow on a tax-deferred basis until they are withdrawn or converted into an income stream. This structure enables policyholders to take advantage of varying cash flow levels over time and adjust their savings strategy to meet their changing financial needs.

Other types of annuities, such as single premium annuities or fixed premium deferred annuities, require consistent contributions of a predetermined amount, which does not provide the same level of adaptability. An immediate annuity, on the other hand, begins making payments shortly after a lump sum is paid, making it unsuitable for scenarios requiring flexible contributions.