A hybrid annuity is considered to be a contract between you and your insurance company that allows you to allocate your funds to both a fixed and variable annuity. A hybrid annuity will allow you to choose the amount of your assets to allocate to a more conservative return investment, which will usually give you a lower rate of return. A hybrid annuity also allows you to decide what amount that you would want to allocate toward an unpredictable annuity, which will usually offer you the potential for a higher return on your annuity. A hybrid annuity can be best for those individuals that have a longer retirement and wish to participate in the stock market. A hybrid annuity appeals to most people because of the safety and growth of the investment that it may produce.