Which factor does NOT typically influence the pricing of an annuity?

The factor that does not typically influence the pricing of an annuity is local government policies. Annuity pricing is primarily impacted by financial and market-related elements, such as interest rates, market conditions, and investment performance.

Interest rates play a crucial role as they directly affect the yield that insurance companies can earn on their investments, ultimately influencing the payouts offered for annuities. Higher interest rates generally lead to higher annuity payments, while lower rates can reduce payouts.

Market conditions also significantly affect annuity pricing. The overall economic environment, including factors such as inflation and investment volatility, can influence how insurance companies price their products and the guarantees they can offer.

Investment performance is another essential component; the returns based on the underlying assets dictate the annuity's growth potential and, consequently, its pricing. Annuities that are tied to investment performance, like variable annuities, are particularly sensitive to this factor.

In contrast, local government policies may govern certain regulations or tax implications but do not have a direct impact on the fundamental pricing mechanisms of annuities. This explains why local government policies do not typically influence annuity pricing.