Annuity

a contract which is sold by life insurance companies that guarantee a fixed or variable payment to an Annuitant (individual) at some time in the future - usually for disability old age and upon death a lifetime income to your heirs. An annuity is sometimes referred to as 'an individual receiving a pension'. For example Miss Jones or Mr. Smith is receiving a pension is the same as if you had said they were receiving an annuity payment. When an annuity is being purchased the annuitant has the option to purchase a contract which provides for Immediate or Deferred income payments. All approved retirement savings Plans such as Superannuation Funds Retirement Schemes Retirement Benefits Scheme Public Sector Pension Plans and National Insurance Scheme (NIS) must pay the benefits for disability old age and upon death to the beneficiaries in the form of an annuity. There are 3 main classes of annuities. These are Straight Variable Instalment Refund Flexible and Indexed. For each type there are options to choose from such as joint and survivor last survivor etc. Before you purchase an annuity you should review your own monthly expenses needs and select the OPTION that best meets YOUR needs.