Guides
Enhanced Annuities
Find out how health and lifestyle details can affect annuity income and why a full market search can make a meaningful difference.
Who could benefit?
As we age, the likelihood of being diagnosed with a medical condition increases. What many people don't realise is that these conditions can actually work in their favour when purchasing an annuity.
Specialist providers consider your health and lifestyle in detail. If your circumstances qualify, an enhanced annuity may offer a different rate from a standard quote.
Smoking Quick Facts
Smoking-related illness shortens average life expectancy, which specialist providers factor into the rate they offer.
- Over 10 million people smoke in the UK
- The average smoker smokes more than 12 cigarettes per day
- Over one fifth of the UK population smoke
- Enhanced rates apply to those who have smoked for 10+ continuous years
- Once the annuity is in force, you can quit smoking without any penalty to your income
How lifestyle affects your income
These are indicative uplifts your actual enhancement depends on your specific circumstances and the provider
Smoking
May affect rates
Smoking history can affect annuity underwriting. Enhanced rates may apply to people who have smoked continuously for more than 10 years.
Being Overweight
May affect rates
BMI can affect annuity underwriting. A higher BMI, especially alongside another health factor, may qualify for an enhanced rate.
Taking Medication
May affect rates
Taking prescribed medication for conditions such as high blood pressure or high cholesterol may affect the rate offered by annuity providers.
How and why do these factors increase pension income?
Traditionally, annuity rates were calculated using mortality tables actuarial data showing average age of death across the UK population. In more recent years, specialist providers recognised that individuals who smoke, drink heavily, or are overweight will on average die sooner. This led to the development of the enhanced annuity.
Beyond obvious lifestyle factors, other determinants of life expectancy are now considered including where you live and your past occupation. A retired foundry worker from an industrial town may statistically have a shorter life expectancy than an accountant in a rural area. Providers reflect this in the rate offered.
Perhaps surprisingly, even factors such as your level of education and the age at which your parents passed away can influence eligibility. An adviser will ask the right questions to ensure all qualifying factors are captured.
What lifestyle factors are considered?
While some factors may not qualify on their own, combinations regularly do. A postcode near a busy road plus a manual working occupation, for example, can unlock an enhanced rate even with no individual health condition.
3.9M
people in the UK suffer from diabetes
375,400
new UK cancer cases per year
113,000
people in the UK suffer a stroke each year
14.4M
adults in the UK have high blood pressure
Statistics are indicative. Sources: NICE, Cancer Research UK, Stroke Association, Blood Pressure UK.
Weight & BMI
How obesity can affect annuity income
A person classed as overweight or obese may qualify for an enhanced annuity. Providers consider BMI alongside other health factors because it can affect life expectancy.
BMI is usually assessed alongside the wider medical picture, including blood pressure, medication, smoking history and other conditions.
Applicants with a lower BMI may not qualify unless they have additional medical factors. An adviser will assess your full picture and identify all applicable enhancements.
Not sure of your BMI?
Use the NHS BMI calculator
Check all annuity options
An enhanced annuity search takes minutes and costs nothing. Our advisers assess your full health and lifestyle profile across specialist providers to compare available rates.
FAQs
Everything you need to know about enhanced and impaired-life annuities
Reviewed for accuracy: . This guide is general information, not a personal recommendation. Pension and tax rules can change, and suitability depends on your circumstances.