Life annuity

What is a Life Annuity?

A life annuity provides you with a series of payments in return for a lump sum investment paid up front to a life insurance company. In return, the issuer pays you an annuity on a regular basis (monthly, quarterly, semi-annually, or annually) for the remainder of your life. The amount of the annuity payment is based on the amount of the lump sum you pay, your age and sex (and that of your co-annuitant if applicable), the survivor benefits you choose, the annuity rate in effect at the time of transfer, the benefit period chosen, indexation, and the joint and survivor annuity percentage (0 to 100%), where applicable.

Options Available

Guaranteed Life Annuity
A guaranteed life annuity has a guaranteed fixed payment period (5, 10 or 15 years). With this type of annuity, even if the annuitant should die during the guarantee period, payments would continue to be made to the designated beneficiary for the remaining guarantee period.

Joint Life Annuity
A joint life annuity will pay the annuitant a fixed amount per month during the annuitant’s lifetime, and upon the annuitant’s death, the full or partial amount of the annuity to the co-annuitant named by the annuitant for the remainder of the co-annuitant’s lifetime. This annuity may also include a guarantee.

Joint Life Annuity Payable on First Death
The amount payable for a joint life annuity may be reduced on first death (of the annuitant or co-annuitant); i.e. the annuity will be paid, in full or in part, to the survivor for the remainder of the survivor’s lifetime. This annuity may also include a guarantee.
The co-annuitant is the person named by the annuitant, at the time the joint annuity is purchased, who will receive the annuity upon the death of the annuitant.

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