What Annuities Are Safe? 
Fixed Annuities are very safe . Variable Annuities however are subject to stock market fluctuations . Fixed Annuities offer Guarantees . For every contractual Guarantee that an Insurance Company makes -LRB- such as 3 % Guaranteed for 5 years -RRB- , must be backed by purchasing a mix of US Treasuries along with a small amount of various other investments . But mostly the Guarantees made by the Insurance Company are largely backed by the financial stability of US Treasuries -LRB- which are considered the safest investment class there is -RRB- . As pointed out already , the best way to judge the financial stability of an insurance company is by their Financial Ratings . In the investment world , And ratings that is a B + + or higher is considered `` investment grade '' . Although as the term of the contract increases , your minimum acceptable Financial Rating should increase as well in my opinion . A longer time frame creates more risk . So for a 3 or 4 year Annuity a B + + Rating might be acceptable for some people . But for an Annuity that is 6 years or longer , it is highly recommended to use an `` A '' Rated Carrier . 