"That number, to be very clear, is not available to cash in," said Jac Herschler, head of business strategy for Prudential's annuity division. "It's only the basis for determining what they can withdraw from their account every year for life."

Equity Limit

Prudential customers agree to let the company move their assets into a bond fund if the investments they selected don't perform well. The transfers are based on a mathematical formula in the prospectus.

Other insurers limit the amount customers may invest in equities if they opt for a rider or restrict the choice of funds, said Tom Idzorek, global chief investment officer for Morningstar Investment Management, a Morningstar unit. Limits on investments help reduce the costs for insurers of hedging against the risk that customers' accounts will run out of money and the insurance company will have to use its funds to continue the payouts, he said.

MetLife's Benefit

MetLife last month started offering a "guaranteed minimum income benefit" that limits buyers to five funds: four have a mix of investments and one is invested primarily in bonds. The portfolio's design means MetLife can promise 6 percent compounded growth annually regardless of the market's performance, said Robert E. Sollmann, head of retirement products for the New York-based company. MetLife has a separate rider that restricts customers to a maximum of 70 percent in equities and a lower compounding rate of 5 percent, Sollmann said.

Individuals have a "tall task" when trying to identify the differences among riders from various insurers, said Idzorek. "Say you wanted to compare five products side by side, good luck."

With the rider, customers can invest in equities and "sleep at night," said Greg Cicotte, president of the sales and marketing unit of Jackson National Life Insurance Co. About 82 percent of contracts sold last year by Jackson National, based in Lansing, Michigan, had a guarantee of lifetime income, Cicotte said. "If the market does go down you know that the income you planned on for retirement is protected."

'Unforeseen Expenses'

Individuals shouldn't put all of their assets in one of these products because "there are always unforeseen expenses," said Masters of Pinnacle Financial Group. "Usually they do carry some severe penalties if you exceed your guarantee in terms of taking money out."