When the markets go up and down, who assumes the risk on investment performance?

It depends on the type of annuity that you own. The insurance company assumes the risk on fixed annuities. Fixed annuities are credited with a specified interest rate for a specified period of time. Rates may change from time to time, however the rate will never go below the guaranteed interest rate regardless of the performance of the investment. The policyholder assumes the risk on variable annuities. If the investments perform poorly, the return on the investment (the annuity) will be less.

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