A Towers Watson survey of major insurers in the UK has discovered that sales of enhanced annuities rose by 38% last year to £2.47 billion. Andy Sanders from the company said that…“2010 was another record year for enhanced annuity sales, with just short of £2.5bn of sales achieved. Many thousands of consumers have therefore benefited from higher pension incomes because their medical condition or lifestyle has been assessed and a lower than average expectation of life anticipated”. Enhanced annuities are offered by some but not all annuity providers, so it is important to shop around to ensure you get the best rates.
The amount of additional income that can be sought from an enhanced annuity varies, but in some circumstances for the most serious medical conditions (such as heart attack or stroke), the retiree can increase their income by as much as 45%. Other, less serious conditions can also qualify a person for annuity ‘enhancements’, so it is vital that retirees when looking to purchase an annuity, declare all past or present medical conditions. Some industry observers believe that conventional annuities could increasingly become less prevalent due to the fact that there are so many conditions that can be considered for enhancements.