The market for impaired life annuities is increasing as more companies compete for the attention of ...
The market for impaired life annuities is increasing as more companies compete for the attention of an increasingly aware consumer base, according to retirement specialist IFA Wentworth Rose Independent.
Conventional annuity rates were nearly 30% lower in January 2000 than in January 1995. This has led to increased improvisation from providers, said Steve Thurgood, annuity manager at Wentworth Rose.
He said: "The impaired-life annuity market is expanding at the same pace as with-profits. The market only really started around five years ago and the level of innovation has risen to the point where providers are tailoring products to consumer conditions."
Thurgood said companies like Britannic-backed Evergreen, which will include the highest number of qualifying conditions when it launches, will add to consumer choice.
A 65 year old male diagnosed with cancer two years ago could benefit from a payout two-thirds greater than a standard annuity, drawing a gross total of £14,983 per annum from a £100,000 fund.
The same man diagnosed with stroke disease two years ago could expect a payout up 52%, giving an income of £13,617 per annum, according to Wentworth Rose's statistics for a five-year guaranteed level annuity based on a single life.
Heart disease sufferers in the last two years might expect their single-life annuity rate to be a third higher, giving them £11,983 per annum, and even smokers or diabetics would be able to find annuities that pay up to 7% more based on the same statistics.