Enhanced Annuities

What are enhanced annuities?

Enhanced annuities provide pension income specifically for people in ill health or for those whose lifestyle may mean they have a shorter retirement. This can include regular smokers, and people who are obese.

Enhanced annuities are sometimes called impaired annuities; these annuity products are essentially the same thing and can give your monthly retirement income a boost of up to 40%. Just over 5,000 different medical conditions allow you to qualify for an enhanced annuity.

When you retire the majority of your pension fund must be converted into a regular income by taking out an annuity. You can take 25% of the total pension fund as a tax-free sum but the remaining amount has to be reinvested to provide you and your family with financial security for the rest of your life. If you have an existing medical problem or lead a lifestyle that is regarded as likely to shorten your life expectancy, you are likely to be eligible for an enhanced annuity. This will mean that you receive a larger monthly income than you would if you were healthy.

How do I qualify for an enhanced annuity?

Obtaining an enhanced annuities quote usually involves having a thorough medical examination and your GP or hospital consultant may also be asked for further health information. These results will be forwarded to your chosen enhanced annuity provider and the resulting income you received will be based on this medical report.

If any of the following apply to you, then you could benefit from an enhanced annuity:
• Do you smoke cigarettes regularly?
• Do you need tablets or injections for a long-term illness?
• Has your health been so bad you have had to stay in hospital during recent years?
Why not enter your health information into the enhanced annuities calculator and see whether you qualify for an enhanced annuity?

Smokers and enhanced annuities

If you shop around you can find that smokers can get up to 15% more income from an enhanced annuity provider. Not all pension insurance companies offer this type of enhanced annuity, so it is important to use the annuities calculator and your Open Market Option to see where you can get the best deal. To qualify for an enhanced annuity you have to prove that you smoke at least the equivalent of 10 cigarettes per day.

What do enhanced annuities provide?

An enhanced annuity is designed to give a 60% higher income to those who suffer from a serious health condition. Generally enhanced annuities pay out 40% higher than average and you could receive this if you ill health is likely to affect your retirement.

The income from an enhanced annuity is still taxable but taking out this type of retirement annuity will give you peace of mind and let you take advantage of the pension that you have saved for. Enhanced annuities also take account of gender and age so use the enhanced annuities calculator to compare enhanced annuity quotes.

What health conditions does an enhanced annuity recognise?

Most of the enhanced annuity providers have similar criteria and most will consider you for an enhanced annuity quote if you have, or have had:

• Any type of cancer, including breast cancer, prostate cancer and skin cancer.
• A heart condition or problem with your cardiovascular system.
• Diabetes (type 1 diabetes or type 2 diabetes).
• Asthma or other respiratory disease such as chronic obstructive pulmonary disease.
• Obesity.
• High blood pressure (hypertension) that requires medication.
• An organ transplant (kidney, for example).
• A stroke.
• Liver disease.

To find out more about enhanced annuities and your eligibility, fill in our annuities calculator and we will get quotes so that you can see how your illness will affect your retirement income.

If you need diabetes life insurance then we have teamed up with a specialist adviser that has worked in this market since 1999.