Who qualifies for impaired life annuities?

Impaired life annuities are a type of enhanced annuity that are available to those retirees who have serious health conditions that will impact on their life expectancy. Impaired life annuities are the most lucrative form of annuity in terms of the amount of money they pay out, as insurers calculate that they will have to pay out retirement income for a shorter time period compared to someone who is healthy. A typical impaired life annuitant may suffer from a range of diseases including heart attacks, strokes or cancer. There are also other health conditions which can enable a retiree to qualify such as obesity and diabetes, although the amount of extra income you get will depend on the severity of your illness. For example if you are classed as morbidly obese then you will be in line for a greater payout compared to someone who is just classed as overweight.

Those applying for impaired life annuities will normally be asked to supply medical documentation supporting their application. They may also have to undergo a medical examination by a general practitioner in order to satisfy the company with which they are purchasing their annuity. Someone underwriting an impaired annuity will look at a range of different factors when deciding if and how much extra income can be given. Below we have outlined some of the questions you might get asked…

  • What is the severity of your health condition (s)?
  • When did the GP or doctor diagnosed it?
  • How often do you take medication and what is the dosage?
  • Has the condition changed over a number of years?

These are routine question that the insurer will want to know the answers to in order see if you do qualify for an impaired life annuity.

Further Reading

Forum on Money Saving Expert
Annuity Discount
Sharing Pensions Impaired Life Annuity
CityWire Article
Standard Life Impaired Life Annuity

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