Which statement is true regarding fixed annuities?

The statement that fixed annuities are backed by the state life insurance guaranty fund is accurate. This means that if an insurance company were to become insolvent, the guaranty fund would help protect the policyholders by covering their claims up to certain limits. This backing provides a layer of security for consumers, as these funds are designed to protect individuals from losing their annuity investments due to the failure of the issuing insurance company.

Fixed annuities are designed to provide a guaranteed rate of return and typically involve straightforward terms, unlike complex and high-risk investment vehicles. While they do usually require multiple payments or contributions from the policyholder to build the annuity value, the primary element that stands out in the correct answer is the safety net provided by the state life insurance guaranty fund which underlines the inherent stability and security associated with fixed annuities.