Are annuities guaranteed? For many retirees and pre-retirees, this is one of the most important questions to answer before moving money into any annuity product. The short answer is: yes, annuities include guarantees — but the type and strength of those guarantees vary based on the product you choose. Some annuities guarantee a fixed interest rate. Others guarantee lifetime income you can never outlive. Many guarantee principal protection, even in down markets. And all guarantees are backed by the financial strength of the issuing insurance company.

At Diversified Insurance Brokers, we help clients understand exactly what is guaranteed, what is not guaranteed, and how to choose an annuity that fits your goals. Whether you want fixed growth, market-linked accumulation without downside risk, or predictable lifetime income, knowing how annuity guarantees work is essential for building a safe and reliable retirement plan.

What Does “Guaranteed” Really Mean in an Annuity?

Annuities are insurance contracts, which means they offer contractual guarantees. These guarantees differ depending on whether the annuity is fixed, fixed indexed, immediate, or income-based. Unlike investments such as stocks, bonds, or mutual funds, annuities are not dependent on market performance for their guarantees — they are based on the insurer’s legal obligation.

Here are the most common types of annuity guarantees:

• Guaranteed interest (fixed annuities + MYGAs)
• Guaranteed income for life (immediate and deferred income annuities, GLWB riders)
• Guaranteed principal protection (fixed + fixed indexed annuities)
• Guaranteed minimum accumulation values (GMAB features)
• Guaranteed death benefits (standard or enhanced)

These guarantees make annuities one of the most reliable components of a retirement income plan — especially compared to market-based investments that carry ongoing volatility and no contractual protections.

1. Guaranteed Interest Rates (Fixed Annuities & MYGAs)

Fixed annuities and multi-year guaranteed annuities (MYGAs) offer one of the simplest and strongest guarantees: a fixed interest rate for a set number of years. Whether the market goes up, down, or sideways, your rate does not change. This makes MYGAs especially appealing for investors who want CD-like predictability with the added advantage of tax-deferred growth.

Examples of terms with guaranteed rates include:

• 1-year MYGA
• 3-year MYGA
• 5-year MYGA
• 7-year MYGA
• 10-year MYGA

Your principal is protected, your rate is locked in, and your growth compounds tax-deferred. For many retirees, this is the foundation of their safe-money strategy.

See Today’s Fixed Annuity Rates

2. Guaranteed Lifetime Income (Income Annuities & Riders)

When people think of annuities, the most well-known guarantee is income you cannot outlive. Only insurance companies can legally offer a guaranteed lifetime income stream. Social Security is one; annuities are the other.

You can receive lifetime income in two primary ways:

• Immediate income annuity (SPIA): Income begins right away.
• Deferred income annuity or GLWB rider: Income begins later, often with guaranteed roll-up rates.

This type of guarantee protects against the biggest retirement risk: outliving your savings.

Estimate Your Guaranteed Lifetime Income

Use the calculator below to preview income options from 75+ carriers.

3. Guaranteed Principal Protection

Fixed and fixed indexed annuities guarantee that your account value will never decline due to market losses. This is a core advantage compared to investing directly in equities, where downturns can dramatically reduce your retirement savings.

With these products:

• Your worst-case annual return is 0%
• Your principal remains intact
• Market volatility does not affect your contract value

This guarantee allows many retirees to stay invested without exposing their core savings to market downturns.

4. Guaranteed Minimum Accumulation Values (GMAB)

Some fixed indexed annuities include a GMAB provision, which guarantees your contract will be worth at least a specified amount at the end of its term — regardless of index performance.

This adds another layer of safety for clients who want market-linked crediting but also want assurance their long-term value won’t fall below a guaranteed baseline.

5. Guaranteed Death Benefits

Every annuity includes a death benefit guarantee. At minimum, your beneficiary will receive your full account value, avoiding market-loss reductions. Some products also offer enhanced death benefits or income riders that provide additional guarantees.

What Guarantees Are NOT Included?

It’s just as important to understand what guarantees do not apply:

• Indexed annuities do not guarantee participation rates, caps, or spreads for future terms.
• Bonuses on fixed indexed annuities may require vesting schedules.
• Illustrated growth is not guaranteed.

Are Annuities Guaranteed by the Government?

No — annuities are not FDIC-insured. Instead, they are backed by the financial strength and claims-paying ability of the issuing insurance company. Each state also has a guaranty association that provides additional protection up to statutory limits.

Because of this, choosing a strong carrier matters. Many clients diversify across multiple insurers for added safety.

How to Choose the Right Annuity Guarantee

The best annuity guarantee depends on your goals:

• If you want predictable growth: Choose a fixed annuity or MYGA.
• If you want income for life: Choose a SPIA, DIA, or FIA with a lifetime income rider.
• If you want growth with downside protection: Choose a fixed indexed annuity.

We help compare guaranteed values, carrier ratings, and long-term performance expectations so you can make a confident decision.

What’s Next?

Guarantees are what make annuities one of the most reliable retirement planning tools available. Whether you’re looking for guaranteed income, guaranteed growth, or guaranteed safety, we can help you identify the strongest options from more than 75 highly rated carriers.

Related Pages

• How Do Annuities Earn Interest?
• Do Annuities Have Fees?
• Do Annuities Pay an Income for Life?
• What Is a Deferred Annuity?
• How Does a Fixed Indexed Annuity Work?