Enhanced annuities are paid to people who may have a shorter than average life span.
Enhanced annuities are offered at a higher rate and are also known as impaired life annuities.
According to a number of studies and researches, there are still a large number of people who do not realise that they may be eligible for enhanced annuity rates and as a result miss out on a potentially high income level after retirement.
In the UK, it is believed that out of every three retirees, there may be one which may qualify for enhanced annuities.
Most people think that a person needs to be critically ill in order to qualify for enhanced annuity rates.
This is not the case.
There are also a large number of people who do not know how these plans work and therefore are not fully aware of the options they have available.
However, when they somehow get familiar with these schemes, they are confronted with the real problem of converting their hard earned pension savings into a regular income that will last them a lifetime.
Enhanced annuities work on the principle that a person who is suffering from a medical condition or has a certain lifestyle may not live for a very long time.
There are a large number of medical issues for which a person may qualify for enhanced annuity.
Whether you have high blood pressure, diabetes or cancer, you may be able to benefit from a high annuity rate.
But, there are various factors that are taken into consideration at the time of working out the annuity rates.
For example, if two people have cancer, they might be offered different annuity rates.
This is due to the fact that both of them may have different kinds of cancer.
Moreover, the age is also an important factor that will be taken into consideration.
Apart from these factors, other aspects of both the individual's health will also be accounted for.
Being eligible for enhanced rates is good news and you must always check to find out if you do qualify for enhanced annuity.
This way, you will be receiving a guaranteed income at a higher rate than people who have a standard annuity plan.
Another factor that affects the rates is where you live.
Those areas where life expectancy is short and has a poor standard of living may make you eligible for enhanced rates.
Moreover, if you have a manual labour background, you may receive a higher rate.
All those who have bought the enhanced pension annuities receive a higher monthly payment than those who have other types of annuities.
People who have dangerous habits such as drinking and smoking are the ones who are most likely to qualify for enhanced rates as these habits play a significant role in influencing the type of annuity that an individual should purchase.
But, not all the medical conditions can make an individual qualify for enhanced annuities.
For this reason, it is important to check with your providers which medical conditions may qualify for enhanced rates.