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  1. Overview
  2. Standard Annuity
  3. Enhanced Annuity
  4. FAQs
  5. What to do next

Enhanced Annuity in detail

Our enhanced annuity recognises the increasing customer demand for an annuity which can offer an increased income to those whose lifestyle factors and/or qualifying medical conditions may affect their life expectancy.

There are a number of factors that determine the level of income offered to you. These include age, interest rates, the medical and lifestyle information supplied, mortality, charges and the type of income chosen.


You can choose a type of income that suits you.

  • The income can be for a fixed amount until you die, or increase at a fixed rate each year, or vary each year in line with the Retail Prices Index (RPI) so if RPI is negative, your income could go down as well as up.
  • When you buy your annuity, you can normally take a tax-free cash sum of up to 25% of the value of your existing pension fund in exchange for a smaller taxable income.

    However, if you’ve already taken retirement benefits from that fund, such as a tax-free cash sum, you may not be able to take a cash sum from this policy.
  • You can choose to have monthly, quarterly, half-yearly or yearly income payments which can be made:
    • in advance, where the first payment will be made as soon as possible after your policy has been set up, or
    • in arrears, so, for example, if you choose monthly payments the first payment will be one month after your policy has been set up.
  • You can choose to have your income paid for a minimum period of time (5 or 10 years) also known as a guaranteed period. If you die during that period your income will continue to be paid until the end of the period.
  • You can choose to have a dependant’s income paid to your surviving husband, wife, registered civil partner or other dependant after you die.
  • Regular payments will be made direct to your bank or building society through the Bank Automated Clearing Services Ltd. (BACS) system.

More information on the features of our Scottish Widows Enhanced Annuity can be found in our customer guide.


  • Once set up, you can’t cash in your plan or change the basis of your income, even if your circumstances change.
  • If your answers to the personal, medical and lifestyle questions are inaccurate or incomplete we may reduce your income or at worst cancel your policy.
  • If you choose an income that doesn’t increase, or increases at a rate lower than future Retail Prices Index (RPI), inflation could reduce what you can buy with it.
  • If you choose an income that is linked to RPI it will vary in line with prices, and in the event of RPI being negative, it could go down.
  • If you transfer from another plan any guaranteed benefits associated with this would be lost on transfer.
  • When you die, your income will normally stop. The total amount of income paid to you and any dependant may be less than the amount used to buy the annuity.
  • Before committing to buying an annuity you should consider all of the pension options that may be available to you such as taking a pension encashment or moving to an income drawdown plan. For more details of all your options at retirement, please speak to a financial adviser, or see our "Retirement Planning" website.

Qualifying medical conditions and lifestyle factors

  • Angina
  • Cancer
    • Bowel
    • Breast
    • Lung
    • Non-Hodgkin Lymphoma
    • Prostate
  • Diabetes
  • Heart conditions
    • Aortic aneurysm
    • Aortic aneurysm repair
    • Atrial fibrillation
    • Cardiomyopathy
    • Cardioversion ablation
    • Heart attack
    • Heart failure
    • Heart valve disorders
    • Heart valve replacement
    • Irregular heart rhythm
    • Peripheral vascular disorder
  • Hypertension (high blood pressure)
  • Multiple sclerosis
  • Neurological conditions
    • Alzheimer’s disease
    • Motor neurone disease
    • Parkinson’s disease
    • Senile dementia
    • Vascular dementia
  • Obesity
  • Raised cholesterol
  • Respiratory conditions
    • Asbestosis
    • Asthma
    • Bronchiectasis
    • Chronic obstructive pulmonary disorder
    • Emphysema
    • Pleural plaques
    • Pneumoconiosis
    • Sleep apnoea
  • Smoking
  • Stroke
    • Cerebral haemorrhage
    • Cerebrovascular accident
    • Subarachnoid haemorrhage
    • Transient ischaemic attack
  • General medical conditions including
    • Cardiac arrest
    • Heart transplant
    • Rheumatoid arthritis
    • Dialysis
    • Hepatitis
    • Crohn’s
    • Cirrhosis
    • CKD
    • HIV
    • Kidney/lung transplant
    • Ulcerative colitis

A full definition of these medical conditions and lifestyle factors can be found on the NHS webpage Health A -Z.

Other conditions could be considered too, so remember to mention every medical condition and lifestyle as this may have an impact on whether you qualify or not.


  • Any costs for advice and services from a financial adviser can be paid to them from your plan via an adviser payment.
  • Our charges are allowed for in the calculation of your income.

Need further information?

See our FAQs or contact us.

Frequently asked questions