It is wise to tell your annuity company all of your health problems and perceived negative behaviors because that can actually benefit you when receiving annuity payments. You certainly should not take up smoking or gain weight because you can receive a higher annuity payout, but if you already have negative habits, don’t hide it from your annuity provider. UK AOL’s article from love money dot com, “Smoking could boost your annuity by 37%,” gives statistics for higher annuity payments in the UK. They used the example of a 65 year old man who has 45,000 pounds with which to buy an annuity. Between the lowest paying basic annuity and the highest enhanced annuity he would receive, they found the following potential increases.
Someone who has smoked at least 10 cigarettes per day for the past ten years could receive 37% more in annuity payments than a non-smoker. Your payment could be 19% higher if you drink more than 50 drinks each week. Two health conditions could get you a 26% increase in annuity payments, having a BMI at or above 36 or having to take a daily high blood pressure pill along with a daily high cholesterol pill. When you are in poor health, an annuity provider will pay you a larger annuity payment because it is likely that you won’t live as long as someone in good health. Obviously, an ideal situation would be to work on getting improved health, but if your health is not ideal make sure you are honest on your annuity questionnaire.
Compare your annuity options with multiple insurance companies before choosing a provider. Do your research to see if one of these so-called enhanced annuities will apply to you based on your health or lifestyle. Those with a combination of multiple negative lifestyle factors may get an even larger boost in their annuity payments. There is typically a 23-page questionnaire that must be filled out by those requesting an enhanced annuity, but it is important to take your time and fill it out honestly. Taking into consideration all things, your annuity payments might be quite a bit higher based on your health situation.
Written by Rachel Summit
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