Annuity for ill health

vatreni

Hi,
I have a couple of chronic but managed conditions that will almost certainly shorten my life expectancy. I have a DC pot and am in my mid 50s, still working at the moment. Are there any particular companies I can approach that would give me a decent annuity if I decide to go that way?

2nd_time_buyer

I suspect that your situation is one that would make an annuity poor value.

To be blunt - they are likely to over estimate your life expectancy compared to your own estimate of your life expectancy.  

dunstonh

Are there any particular companies I can approach that would give me a decent annuity if I decide to go that way?

Any local IFA should help.   Generally, if the pension fund is over £25k-50k and you have health issues, then an IFA should be able to obtain the best annuity rates.       In part because the commission on direct options starts to exceed the adviser fee around that amount and because annuity providers have found that they get health questionnaires filled in with better detail with IFAs rather than personally filled in ones or those working from call centres on targets.

Plus, post 2015 annuities have many more options than pre-2015 ones.  The pension freedom legislation allowed annuities to more choices.  Particularly with death benefits.   So, unless you know the options, you could get the wrong one as not all providers offer all the options.

That said, annuity rates are near all time lows.   Enhanced rates have hurt the cross subsidy pool reducing mortality gain.   The number of people buying annuities has dropped, reducing the pool further and interest rates/gilt yields are keeping annuity rates low.      Things may well improve when gilt yields begin to rise again.

And you really shouldn't be buying an annuity in your 50s if you can help it.

vatreni

dunstonh said:

And you really shouldn't be buying an annuity in your 50s if you can help it.

I'd rather not - there aren't many (any) benefits to living with a serious health condition, and this would have been one of the few I can think of. Thanks for the advice, appreciated.