Equity index annuities offer what main benefit?

Equity index annuities primarily offer a combination of higher interest potential while safeguarding the principal investment from losses. This means that although the returns are linked to a stock market index (such as the S&P 500), which can yield higher interest rates than traditional fixed annuities, the principal amount you invest is protected from market downturns. If the equity market does not perform well, the policyholder does not lose money; their investment remains intact.

In contrast, guaranteed cash value increases typically relate to traditional whole life insurance policies, which are different from annuities. Stable monthly payments are more characteristic of fixed annuities rather than equity index annuities, which can have variable returns based on index performance. Lastly, direct investment management implies a hands-on approach to investing, which is not applicable to equity index annuities as the investment in the index is done through the annuity, without direct control by the policyholder.