There are many options that can be included on an annuity that protect loved ones and dependents after the death of the annuitant.
However, these options will reduce the income of the retiree for the rest of their life, so it's important to shop around for the best possible quote.
To ensure the right balance, retirees should have a range of quotes with varying levels of death benefit.
The options that can be chosen for an annuity can be found in our Annuity Options guide.
The death benefit option provides additional security to beneficiaries in the event of the annuitant's death.
In the UK market, the death benefit may take the form of a guaranteed period of payments or a lump sum payment to the beneficiary.
For example, with a joint life annuity, the surviving spouse or partner may continue to receive payments after the death of the annuitant. Similarly, with a single life annuity, a guaranteed period of payments may be included in the contract, which would continue to be paid to the beneficiary if the annuitant passes away before the end of the guaranteed period.
It's important to note that the death benefit feature and the terms and conditions of the annuity contract may vary depending on the annuity provider and the specific contract. As with any financial product, it's important to carefully review and understand the terms and conditions before purchasing an annuity.
In conclusion, death benefits are an important consideration when selecting an annuity. They can provide additional security and peace of mind to beneficiaries, ensuring that they are financially protected in the event of the annuitant's death.
It’s important to speak with an expert to determine which annuity is right for you.
At Pense, our experts are committed to helping you navigate the options and choose the annuity that is right for you.
Basic death benefits only reduce the income slightly
Having no death benefits gives the highest income
Fixed Term Annuities can come with other types of death benefits such as value protection
Pense will give you as many quotes as you need to help make the right decision