This article http://ow.ly/2Jrhu refers to impaired life annuities which are supposed to lead to a greater life annuity income. And, in particular, it refers to smoking and high blood pressure as being two of the medical conditions which could lead to this higher income life annuity payment.
I’m not sure how U.K. insurance companies handle this but it is not generally the case in Canada. Here you need to have one foot in the grave before you can receive a better payout of any proportion. In other words, you need to supply a medical report that your life expectancy is x years before you can receive any consideration of a higher life annuity payment.
Hoping for a better income due to the fact that you smoke seems to be the same mindset of those that believe indexing will help their income increase over time. Yes, your income will increase but at what cost?
Last week we quoted on a $425,000 capital for a couple aged 63. With a 10 year life annuity guarantee, the joint life annuity payment was $2260. However the 2.5% indexed life annuity payment was $1610 at that rate. It will take a long time to equal the payments of $2260. And you then have to make up all the payments you have not received to that point in time! I don’t know how long all this will take and by then, it may not matter.