Annuities are a contract between you and your life insurance company. It provides death benefits and may also include other guarantees.

Annuities do have limitations, and guarantees are subject to the claims-paying ability of the issuing insurance company.

Annuities were designed to be a reliable means of securing a steady cash flow for an individual during their retirement years and to alleviate fears of outliving one's assets.

Defined benefit pensions and Social Security are two examples of lifetime guaranteed annuities that pay retirees a steady cash flow until they pass.