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CoolBee · 11-05-2011, 10:18 AM

I think it's daft too, from MY perspective, but it's not necessarily stupid from a NON_HEALTH perspective.

I don't know what country he is in, but in the UK, you can sometimes get higher pension annuity rates if you are a smoker because they figure you will die sooner so they can afford to pay you more. Same goes for some other health conditions.

Maybe he's got some calculation like that going on and wants to be able to prove in 40-50 years time that he's a life-time smoker?

"Does that mean the cost of the enhanced annuity is a lot more expensive? No, an enhanced annuity provides a higher annual annuity income compared with a standard annuity, and are aimed at retirees who, statistically, may have a shorter than average life expectancy. A smoker fits into this category, so the income would be higher each year for the same annuity purchase price. The same applies to retirees with ill health, they are also likely to be eligible for higher enhanced annuity rates."

Source: More annuity options and higher pension annuity rates, smoker and enhanced | Right Annuity

(And this is why, at present, a woman with £100k to buy her pension annuity will get less p.a. than a man with £100k, because women tend to outlive men so the company will be paying out longer. New legislation in the UK is set to make then 'equal' from next year I believe without checking it out.)

11-05-2011, 10:18 AM	#41 (permalink)
CoolBee Family Member Join Date: Feb 2009 Posts: 2,044	I think it's daft too, from MY perspective, but it's not necessarily stupid from a NON_HEALTH perspective. I don't know what country he is in, but in the UK, you can sometimes get higher pension annuity rates if you are a smoker because they figure you will die sooner so they can afford to pay you more. Same goes for some other health conditions. Maybe he's got some calculation like that going on and wants to be able to prove in 40-50 years time that he's a life-time smoker? "Does that mean the cost of the enhanced annuity is a lot more expensive? No, an enhanced annuity provides a higher annual annuity income compared with a standard annuity, and are aimed at retirees who, statistically, may have a shorter than average life expectancy. A smoker fits into this category, so the income would be higher each year for the same annuity purchase price. The same applies to retirees with ill health, they are also likely to be eligible for higher enhanced annuity rates." Source: More annuity options and higher pension annuity rates, smoker and enhanced \| Right Annuity (And this is why, at present, a woman with £100k to buy her pension annuity will get less p.a. than a man with £100k, because women tend to outlive men so the company will be paying out longer. New legislation in the UK is set to make then 'equal' from next year I believe without checking it out.)