Key Features of the
Guaranteed Pension Annuity
The Financial Services Authority is the independent financial services regulator. It requires us, Hodge Lifetime, to give you this important information to help you decide if this pension annuity is right for you. You should read this carefully so you understand what you are buying; and keep it safe for future reference.
You can only buy this annuity with money from certain types of pension fund, using the open market option. In exchange for your fund, we promise to pay you an income for the rest of your life.
Its aims
- To pay you a guaranteed income for the rest of your life.
- If you choose a minimum guaranteed payment period and die during that time, we promise to keep paying your annuity income for the remainder of the guarantee period.
- If you choose a dependant’s annuity and you die first, we will pay your named dependant all or some of your income for the rest of their life. You choose how much they will get. (Their income starts once any guarantee period expires, see above).
- To let you choose how often you want us to pay your income.
Your commitment
When you buy this annuity you will be entrusting all or part of your pension fund to us, for life.
You can’t change providers later on (see Risks). If you want to take a tax free cash lump sum from your pension, you must ask your existing pension provider to pay this to you before they transfer your pension fund to us. Otherwise you will lose the chance, for ever.
Your application form must be completed accurately. If false information or missing information leads us to pay you a higher income than you are actually eligible for, we will recover the overpayments and reduce future payments. In extreme cases, your annuity could even be cancelled.
Risks
This policy has no cash in value at any time. If you die in the early years of the policy unless you have chosen a dependant’s annuity and/or a guaranteed payment period you will get back much less than you paid for the annuity.
Your income from this annuity will not go up. So, in future years any increases in inflation or income tax will reduce what you can buy with this money.
We don’t take your (or your dependant’s) health into account in setting our annuity rates. If you (or your dependant) smoke or have any medical or health problems you may be eligible for more income from another provider.
Your pension funds could go up or down in value before we receive them. If they go up you will get a higher income. If they go down you will get less.
Once you have bought this annuity, and the cancellation period has ended, even if your circumstances change, you will no longer have access to the funds you have paid to us.
This means you won’t be able to:
- Cash it in or get a refund
- Pay it back into your original pension plan or scheme
- Switch to a different annuity provider
- Alter or remove any of your chosen annuity options (e.g. the dependant’s annuity if there is no longer a dependant).
Next: Guaranteed Pension Annuity Questions & Answers
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