What is an annuity?

Understanding your options

What annuities can do for you

An annuity pays you a guaranteed income for the rest of your life.  You can buy one with a lump sum, usually from your pension. 

Guaranteed income for life

Receive regular income payments, no matter how long you live

Individually calculated

Your income quote is based on your personal circumstances

Range of options

There are plenty of different annuities designed to suit particular needs

Get to grips with annuities

How does an annuity work?

An annuity will provide a guaranteed, regular and taxable income for the rest of your life. An annuity can provide certainty that you’ll receive a predictable amount, much like a salary, and it won’t run out, no matter how long you live.

How is an annuity calculated?

There are several factors that will affect the income you can receive, including your age, health, where you live and the size of your pension or lump sum.

What happens to your annuity when you die?

Generally, because an annuity is only designed to pay an income to you while you’re alive, payments will stop when you die. This does mean that if you don’t live for long after buying an annuity you could get back less than you paid for it.

Most annuities have guarantees availiable, through which your dependants will get some money back if you die within an initial period, plus you may have the option to provide for a spouse, partner or other dependant.

Annuities we offer

We offer 3 different annuities. All offer an income for life, but they work in different ways to suit particular needs.

Pension Annuity

The most popular choice, our Pension Annuity gives you a guaranteed income for the rest of your life and takes into consideration your health and lifestyle when calculating your income. 

Pension Annuity key features
(PDF 220 KB)

With-Profits Pension Annuity

Our With Profits Pension Annuity gives you a regular income for the rest of your life, but the income changes in line with investment returns. You can only buy this product through a financial adviser.

With-Profits Pension Annuity key features
(PDF 158 KB)

Immediate Life Annuity

Similar to our Pension Annuity, our Immediate Life Annuity is not bought using your pension, but with savings, investments or an inheritance. You can only buy this product through a financial adviser.

Immediate Life Annuity key features
(PDF 175KB)

Things to consider before applying

An annuity is just one of your options for using your pension savings and it’s not the right choice for everyone. There are some things you need to be aware of.

  • Once an annuity is set up, you can't usually make any changes to it or get back any of the lump sum you used to buy it with
  • All annuity payments stop when you die unless you’ve chosen a protection option that pays a spouse, partner or other dependant
  • Depending on how long you live, you may get back less from an annuity than you paid for it
  • You don’t need to buy an annuity from your pension provider. It’s a good idea to shop around to make sure you get the right deal for you

Pension Annuity calculator

Use our annuity calculator to get a quote for a guaranteed income.

Financial advice

If you’re not sure whether an annuity is right for you, or how to make the best use of your pension options, you might want to talk to a financial adviser.

Pension Wise

This government service offers free and impartial guidance on your retirement options, either over the phone or face-to-face.

Visit Pension Wise

pension wise

Product provided by: Aviva Life & Pensions UK Limited. Registered in England No. 3253947. Registered office: Aviva, Wellington Row, York, YO90 1WR. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Firm Reference Number: 185896.

Aviva UK Digital Limited introduces to Aviva Life & Pensions UK Limited for annuities. Aviva UK Digital Limited is registered in England No. 09766150. Registered office: St Helen's, 1 Undershaft, London EC3P 3DQ. Authorised and regulated by the Financial Conduct Authority. Firm Reference Number: 728985.