Annuities are a guaranteed income for the rest of your life. When you purchase an annuity you do so normally on the following criteria:
- Fund size
- Annuity Options purchased
The annuity provider gives you an annuity rate based on their opinion of your life expectancy. So the longer you are expected to live the lesser the rate the provider will give you. On the flip side of course if you have a shorter life expectancy then you will get a better annuity rate.
This is where enhanced annuities come in.
What exactly are enhanced annuities?
An enhanced annuity is one that pays out a higher rate than conventional lifetime annuity based on the fact that your life expectancy is regarded as lower. Enhanced annuity providers base this on things like:
- Whether your smoke and how many.
- Whether you take regular medication.
- The postcode where you live, in some cases.
- Your height and weight.
- Whether you’ve ever been hospitalised with a medical condition before.
If you take medication for a heart condition then you may have a lower life expectancy than those who do not. Therefore, annuities providers expect that they’ll be paying out your income over a much shorter period of time and will offer you an Enhanced Rate Annuity.
How Do I know if I qualify for an Enhanced Rate Annuity?
Industry figures suggest as many as 40% of retirees could qualify for an enhanced rate annuity, which could increase income by anything from a few percent to 60% for a serious medical condition.
If you have some of the conditions mention you may qualify. Get a quote for enhanced annuities