Which type of insurance policy guarantees fixed benefits during the annuitization phase?

A fixed annuity guarantees a series of fixed benefits during the annuitization phase, which is a key feature that differentiates it from other types of policies. This means that when an individual decides to convert their accumulated savings into a stream of income, the fixed annuity provides a guaranteed payout amount that remains stable regardless of market fluctuations. This predictability allows policyholders to plan their finances with confidence, knowing precisely how much income they will receive over the annuity's payout period.

In contrast, other options do not offer guaranteed fixed benefits during the annuitization phase. For example, a decreasing term policy focuses on life insurance benefits rather than annuitization, while a variable policy's benefits can fluctuate based on market performance, leading to uncertain payouts. Similarly, universal life policies provide flexible premiums and death benefits but do not guarantee fixed annuity payments. Hence, the unique characteristic of guaranteeing fixed benefits during the annuitization phase makes a fixed annuity the correct choice.