Which statement best describes a variable annuity?

Which statement best describes a variable annuity?

• A. It funds premiums into a separate account with investment subaccounts, and future payments depend on investment performance.
• B. It guarantees a fixed rate of return and fixed payments regardless of market performance.
• C. It is a life insurance product that pays a fixed death benefit.
• D. It has no investment risk because the insurer guarantees all returns.

Answer: (A)