Financial Industry Regulatory Authority (FINRA) Practice Exam 2026 - Free FINRA Practice Questions and Study Guide

The statement regarding the annuity contract that is true is related to how the type of annuity selected influences the payment amounts to the annuitant. Annuities can take various forms, such as fixed, variable, or indexed, and each type has its own method of determining payouts. For instance, a fixed annuity provides guaranteed payments based on predetermined factors, while a variable annuity's payments can fluctuate based on the performance of underlying investments. Thus, the type of annuity chosen directly affects how much and how often the annuitant will receive payments.

Understanding this is crucial when planning for retirement or long-term income, as it allows individuals to choose the annuity type that aligns best with their financial goals and risk tolerance. In contrast, other statements in the question lack accuracy regarding how annuities function.