Welcome to Microsoft Q&A Platform, thanks for posting your query here.
Based on your ask, Yes your custom image is a snapshot of when you created it. You would have to make a new image to get the new latest updates, or look into update management.
Even if you have created with an updated OS, there are chances that more updates will come dude to security needs and these things still need to be handled to make sure the VM is patched up to date.
It is recommended that you look into Update Management to keep OS updated.
Refer these document for more details:
https://video2.skills-academy.com/en-us/azure/automation/update-management/manage-updates-for-vm
Hope this helps.
If you need further help on this, tag me in a comment.
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