The preexisting condition clause in health insurance: eliminates coverage for conditions that existed before the effective date of the current contract provides blanket coverage for preexisting conditions makes a preexisting insurance contract pay for prior medical conditions coordinates the payment of already existing conditions among multiple policies A variable annuity: accepts variable amounts of deposits on a periodic basis during the accumulation period pays an annuity to a variable number of people overcomes the problem of inflation and the loss of purchasing power pays a fixed dollar amount for a variable length of time is typically cheaper than a comparable fixed annuity