Annuity Types:

Which type of annuity is right for you? It’s not exactly the easiest of questions to answer, particularly if you have next to no understanding of what an annuity is, or how to go about finding the best possible rate.

Here at Annuity Rates we do just that – we pair up with partners up and down the UK who specialize in sourcing the highest rate annuities on behalf of our customers; we ensure that you always get the best retirement income, relative to your personal circumstances, you can possibly acquire.

What is an annuity?

An annuity basically determines how your pension fund will be distributed i.e. how much of your annuity will be distributed as a lump sum and how much will be distributed over the length of your retirement. However, it doesn’t stop there.

Enhanced or Impaired Life Annuities:

Enhanced annuities are available to people who have led a certain lifestyle, for example smokers – this type of annuity typically results in a higher income for the individual, mainly as a result of the fact they are considered to be a health risk i.e. it’s not believed they will live as long as a person who has not smoked.

An impaired life annuity is similar to an enhanced annuity, however it is more applicable to people who are suffering, or have suffered, from various health conditions e.g. a heart bypass.

That said, impaired-life annuities are also very person-centric, two people with the same condition may be offered different rates, depending on the nature of the condition and a whole host of other factors. As a result, it’s vital to shop around and make sure you get the best conceivable retirement income relative to your personal circumstances. 

Joint or Single Life Annuities:

Whether you wish to opt for a joint or single life annuity is another important decision you will need to make when buying an annuity – the decision is whether you want to purchase an annuity which solely covers you as an individual, or whether you want to purchase a joint annuity which protects your partner as well i.e. it will keep providing your partner with retirement income, in the event of your death.

Joint annuities are typically accompanied by a lower rate simply because the insurance company is burdening more risk. It’s also important to remember that the rate may be lowered further still if your partner is younger than you (as a result of the age difference, the insurance company will expect to be paying out for longer than it may if you bought a single life annuity).