Pensioners one health check away from additional income

Millions of people in their retirement could be missing out on additional income paid to pensioners who live with an underlying medical condition, according to the latest research from MGM Advantage.

A survey carried out by the pension specialist indicated that nearly three quarters – 72 per cent – of UK adults aged 55 and over are unaware that certain medical conditions could entitle them to a higher level of pension income through their annuity provider.

An enhanced annuity, otherwise known as an impaired life annuity, can be paid to people who suffer from a range of conditions including high blood pressure, high cholesterol, heart disease and diabetes.

MGM Advantage says that as many as 71 per cent of people over 55 are unaware that medical conditions entitle them to higher income.

"It is an unfortunate fact of life that as we get older, we are more at risk of getting underlying health conditions," said Aston Goodey, sales and marketing director at MGM Advantage. "Those buying an annuity should have a health check and be sure to inform their annuity provider of any health conditions to see if they qualify for an enhanced annuity."

"The difference between a standard and an enhanced annuity can be significant and would make a real difference, particularly when the cost of living is squeezing finances."

MGM Advantage is urging people nearing retirement to have a health check for their own good as well as to see if they can benefit from any underlying health condition. According to its research, 40 per cent of UK adults aged 55 and over have or have had high blood pressure and 33 per cent have had high cholesterol, both of which are conditions that could qualify them for a higher pension income.

However, one in seven over-55s still working said it had been more than five years since they last had a health check, with a further 11 per cent not able to remember when they last had one.

Goodey added: "Clearly more needs to be done in terms of educating those both in and approaching retirement. More information needs to be provided about the benefits of enhanced annuities for those with medical conditions."

"To ensure you are getting the best annuity rate possible, you should also exercise the Open Market Option and shop around for the best rate."

The retirement income specialist warns that people who do not mention any underlying health issue could risk losing out financially, as enhanced annuities pay out on average 20.68 per cent more for men and 22.15 per cent more for women.

According to statistics from MGM Advantage Annuity Index 2011, for the first five years of retirement the difference between the amount paid out by an average standard and enhanced annuity is £2,908.30 for a man buying an annuity with £50,000 and £2,642.30 for a woman.