In a variable life annuity, how do benefit payments change over time?

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In a variable life annuity, benefit payments fluctuate because they are linked to the performance of the underlying investments in the separate account. As the market value of these assets changes, the amount distributed to the annuitant can also change. This means that the annuity's value can grow or shrink depending on the investment performance, leading to potential increases in benefit payments when the investments perform well, or decreases when they perform poorly.

The structure of variable life annuities is designed to offer the potential for greater returns than fixed annuities, which do not adjust based on market performance. This inherent connection to investment results is what distinguishes variable annuities and makes them attractive for individuals looking for growth but also carries the risk of losing value, thus impacting the benefits over time.

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