Why is the equity$-$indexed annuity annual reset design the most expensive one for an insurance company to hedge?

A$)$ Because of the surrender charge period is the shortest of the other plan designs.

B$)$ Because a new index starting point is established each year and gains are passed on to the policyowner at that time.

C$)$ Because index gains are based only on averages; the index gains are only calculated and credited once at the end of the term

D$)$ Because this particular type of equity$-$indexed annuity design offers a $10\%$ free withdrawal.