A recent research by Towers Watson shows a rise of enhanced annuities sales by 38% to £2.47 billion in 2010 over 2009. However, the sales of enhanced annuities were down by 4% in the second half of 2010 and were recorded at £1.21 billion.
“2010 was another record year for enhanced annuity sales, with just short of £2.5bn of sales achieved. Many thousands of consumers have therefore benefited from higher pension incomes because their medical condition or lifestyle has been assessed and a lower than average expectation of life anticipated”, said Andy Sanders, senior consultant at Towers Watson.
Enhanced Annuities – which provide higher pensions to people with negative lifestyles such as smoking, excess weight or hazardous occupation and to people with serious medical conditions, will continue to flourish, the Tower Watson research shows.
Experts believe that with the advent of enhanced annuities catering to specific requirements, conventional annuities may soon become a thing of the past.
The Tower Watson survey covered leading pension providers such as Aviva, Legal & General, Prudential, Reliance Mutual etc.