I have a broad range of bond funds - most of them intermediate. They are not Treasuries - they are much more broadly diversified and so usually yield quite a bit more for the same duration. I have held most of these bond funds for 15 years now and plan to for decades more. I don't feel compelled to sell them and buy something else.
I have picked up things like 3% 5-year CDs when they seemed attractive - but usually for my cash position!
My bonds are there for the diversification, and so I can sell them to buy stocks after bad market years. I don't see how you do that with an annuity.
I am a total return investor. I don't get look at the projected returns of my underlying assets or whatever dividends they may throw off any given year. When I withdraw, I sell whatever I need to at the time. Some years it's stocks, some years it's bonds, some years it's cash.
FWIW - I don't expect interest rates to "normalize" for another 10 years. Global growth is too slow, and deflationary pressures to high.