Goodbye gender pricing, hello personalised annuity rates, says Legal & General.

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Why pension annuity providers are more interested in your health than your gender.

From 21 December 2012, annuity providers will no longer be able to offer customers different rates purely based on their gender. But as Tim Gosden, Head of Annuity Product Development for Legal & General explains, enhanced annuity providers have already been focussing for a while now on what really matters … health.

“Historically, pension annuity providers have offered better annuity rates to males because on average they have a shorter life expectancy than females. Where a male and female of the same age buy an annuity with the same pension fund, the male would have been offered a higher income each year because on average, the provider expects to pay them an income for a shorter period of time. The total income paid to each is likely to be broadly the same.”

Age, gender and where someone lives are factors that are currently used to determine average life expectancy and they influence the amount of pension income an annuity provider will offer. But as an industry we’re now adopting a more sophisticated approach and using additional factors to more accurately determine individual life expectancy.”

Tim added; “Information about an individual’s health and lifestyle will lead to a more accurate estimation of how long a person is likely to live and how long their income is likely to be paid. The outcome could be the offer of more income for life. So it’s crucial that people disclose this information as fully and accurately as possible when shopping around for the best annuity rates.”

The more serious your condition(s) the more income you could be offered, but you could also qualify for extra income based on common lifestyle health risks. To get an instant decision on extra income based on smoking, weight, high blood pressure, high cholesterol or Type 2 diabetes, contact Legal & Genera.

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Timothy Gosden
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