New York State Life Insurance Exam Questions Practice Question
Each of the following are characteristics of a fixed annuity contract EXCEPT
Correct Answer: A
Rationale: In a fixed annuity contract, funds are typically invested in the insurer's general account, not a separate account, which is why option A is the exception. Option B is accurate as fixed annuities guarantee a minimum interest rate, providing security to the investor. Option C is also correct; benefit payments in a fixed annuity remain level throughout the payout period, ensuring predictability. Lastly, option D is true since fixed annuities can be structured as either immediate or deferred, allowing flexibility in how benefits are accessed.
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