You may assume, reading the word “fixed” in “fixed indexed annuities,” that this type of annuity allows for no flexibility. But, in actuality, a fixed indexed annuity (also referred to as an FIA) may provide you with opportunities to make choices for yourself.

Firstly, one of the benefits of annuities such as FIAs is that you can select the index or indexes you want. Although you aren’t buying stocks or funds, you could choose an external index. Interest from your FIA can grow differently based on which index you pick.

You could even specify how much of your annuity you want to connect with certain indexes.

Another benefit of these annuities is the buyer’s choice of crediting method. The insurance company abides by a certain set of rules and timeframes if calculating the index interest of your annuity. For example, a buyer can choose between a monthly or annual crediting method.

Some methods of crediting use an average value over a certain period of time. Others base their interest on the differences in rates over a period of time. Yet another choice of crediting method marks the changes in the index from the first-anniversary contract date.

The interest is then calculated one year later based on that change.

Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, which may affect policy values.