smoker enhancement
This applies to both a pension and purchased life annuity. There are a number of factors relating to health or lifestyle that mean an individual could benefit from an enhanced annuity, resulting in a significant increase in the pension income or income from a lump sum in retirement. Although these people may be very healthy today, due to these factors their life expectancy is less than that of the norm.

If the annuitant smokes 10 or more cigarettes per day (or 3 ounces of cigarette tobacco per week) and has done so for the past 10 years, they can receive enhanced rates from a life company. Enhanced rates do not apply to annuitants that smoker pipes or cigars. If after being accepted on the enhanced terms the annuitant gives up smoking, the pension income will still continue at that rate for the rest of the annuitant's life.

The follwowing table shows the smoker enhancement over the standard annuity rates. The enhancement increase with the age of the annuitant and for level rates can be as high as 25% for males and 31% for females at 74 years of age. Where escalation is included the extra annuity income can be as high as 31% for males and 40% for females at 74 years of age.

If the annuitant has suffered ill health in the past that has reduced their life expectancy relative to the mortality tables, then again enhanced rates could be payable. If it is the annuitant's spouse that has suffered ill health, is a smoker or is overweight then whether pension annuities or a purchased life annuities the life companies could pay a higher income based on a joint life annuity.

In addition life companies also consider the lifestyle and location of the annuitant. In particular, it the annuitant has been a manual worker for most of their working life of live in a particular part of the country, enhanced annuities could be payable. Before qualifying for enhanced terms it is likely that the life company will ask for General Practitioners Report (GPR) from the annuitant's doctor to verify the medical conditions before an enhanced income can be paid.

At retirement the individual can use a pension fund to buy an annuity and has the option to use an open market option to search for the highest pension annuity. Once you have purchased an annuity it cannot be changed, so learn more about annuities, compare annuity rates and before making a decision at retirement, secure a personalised pension annuities quote offering guaranteed rates.


Annuity rates table - smokers
The smoker enhanced rates shown below are only examples. For the full tables try the following;

best annuity rates smoker single rates standard single rates smoker joint rates standard joint rates with profits rates diabetes rates purchased life rates impaired health rates immediate needs rates

These rates are for a pension purchase price of £100,000 after the tax free lump sum of £33,333 has been taken.

Last updated: 21 December 2008

Male Single Life Female Single Life   Male 50 £6,468     Male 55 £7,044     Male 60 £7,896     Male 65 £9,084     Male 70 £10,632     Male 74 £12,792     Female 50 £6,300     Female 55 £6,768     Female 60 £7,524     Female 65 £8,640     Female 70 £10,224     Female 74 £12,240   JOINT, level annuity, 50% spouse Male + Female Spouse   Male 50 and Female 50 £6,048     Male 55 and Female 55 £6,480     Male 60 and Female 60 £7,056     Male 65 and Female 65 £7,896     Male 70 and Female 70 £9,048     Male 74 and Female 74 £10,356   The above are examples of the rates available. Click the following for the full smoker tables and other annuity options.

Annuity rate notes:
The above example table shows the best open market option pension annuity rates for smoker single and joint annuitants based on:

Male Rate Change Female Rate Change   50 £252 3.8%     55 £252 3.5%     60 £252 3.2%     65 £300 3.3%     70 £312 2.9%     74 £360 2.7%     50 £276 4.3%     55 £300 4.4%     60 £300 4.0%     65 £336 4.0%     70 £384 3.9%     74 £468 4.0%   JOINT, level annuity, 50% female spouse Joint Rate Change   Male 50 and female 50 £276 4.6%     Male 55 and female 55 £300 4.7%     Male 60 and female 60 £276 4.0%     Male 65 and female 65 £312 4.1%     Male 70 and female 70 £348 4.0%     Male 74 and female 74 £312 3.2%   Annuity table - the annuity rate changes are based on £100,000 in July 2008 compared to July 2007. For annuities specific to your circumstances you should complete the free annuity quote.

Latest rates higher than 12 months ago   Latest rates lower than 12 months ago   £ Difference in pounds sterling (per annum)   % Percentage change from 12 months ago   nc No Change