Annuities
Annuities – a pension income for life
What is an annuity?
When you retire, some or all of your pension fund can be used to purchase a lifetime retirement pension which is also called an annuity. The purpose of this pension annuity is to provide an income for the rest of your life An annuity suits those who have a low appetite for risk and demand certainty of income in retirement.
Our Strengths in Annuities
- Only the State pays more pensions than Irish Life. In 2019 we paid out over €228M to over 42,000 pensioners.
- Our annuity administration service is highly regarded by customers and pension professionals.
- Our solvency ratio (stable at 175% at December 2018) provides deep security.
Source: Irish Life
What annuity products are available from Irish Life?
Enhanced Annuity
An enhanced annuity is an innovative product where your income provided is based on your health circumstances. We assess your health through an interactive lifestyle and medical questionnaire completed as part of the annuity quotation process. If you qualify for an enhanced annuity the income provided will be higher than that provided under a standard annuity. Up to 60%* of retirees may qualify for an enhanced annuity and we recommend that all retirees ask their Financial Advisor whether they may be eligible for this product.
*Source Reinsurance Group of America (RGA), based on UK annuity market statistics.
Standard Annuity
The standard annuity will be your option if you do not qualify for an enhanced annuity or you do not investigate the enhanced annuity option at retirement.
Can my income increase while in payment?
- Advantage: You know exactly the amount of income you are going to receive for the rest of your life.
- Disadvantage: It isn’t inflation-proof and offers no protection against the effects of higher than expected inflation. As time goes by, its purchasing power may diminish, if inflation exceeds any increase.
- Advantage: The purchasing power of your income is somewhat protected against the effects of inflation.
- Disadvantage: Choosing escalation on you income will impact on the initial amount of pension you can expect from your fund. The amount would be less than if you choose a pension with no escalation.
Additional Options
The following options can be added to any of the above mentioned annuities, at an extra cost:
Taxation
All annuities are subject to income tax in the same way as any other income you receive. They may also be subject to Pay Related Social Insurance (PRSI) and Universal Social Charge (USC) deductions.
Annuity calculator – How do I get an annuity quote?
We offer a unique online annuity calculator www.pensionchoice.ie which allows you to run quotes for your pension annuity.
For more information please contact your company pension advisor, your broker, or Irish Life Sales Support on (01) 704 2000 or email Happytohelp@irishlife.ie. Alternatively download our guide - All About Annuities