Selecting a guarantee period

If your client does not include a guarantee period, dependant's pension or value protection, their annuity income would stop when they die and no further payments would be made.

Helping clients protect the value of their pension

It may not be of concern, but should your client wish to, they can incorporate a guarantee period to ensure that income will continue to be paid until the end of the guarantee period selected – up to 30 years from their first payment.

See below for an overview of how this option can work.

Points to consider

• Your client can choose a guarantee period between one and thirty years.
• There is a cost associated with this choice – the longer the guarantee period, the lower the annual income the client receives will be.
• If they live past the guarantee period, then their income continues, but in the event of their death, the income will just stop (if no other options have been chosen).
• Where an individual under the age of 75 dies and has a guarantee period, any payments made to beneficiaries will be tax-free. If they die after the age of 75, the income will be taxed at the beneficiaries’ marginal rate of tax.