Six in 10 people aged 55 and over have received medical treatment for conditions that would qualify them for a higher pension income - worth more than £8,000 for the first five years of retirement.
However, research from MGM Advantage reveals that 72 per cent of over 55s are unaware that certain medical conditions could entitle them to an enhanced annuity.
Shockingly, according to data from the Association of British Insurers, in 2011 just 2 per cent of annuity customers buying without advisers purchased an enhanced annuity, showing that the industry needs to do more to educate consumers. Where customers took independent financial advice, enhanced annuities accounted for nearly 41 per cent of sales by premium.
Forty per cent of over 55s have suffered or currently have high blood pressure levels, while 33 per cent of the over 55s have or have had high cholesterol, with a further 12 per cent requiring treatment for diabetes. All of these conditions could qualify for a better retirement income through an enhanced annuity, with as many as 70 per cent of retirees potentially qualifying.
Also, a smoker with high blood pressure would receive £1,000 extra income every year by choosing an enhanced annuity.
Andrew Tully, pensions technical director at MGM Advantage, says: "With such a high proportion of our retirement nation experiencing medical problems, it is of deep concern that many people remain unaware of enhanced annuities.
"When you look at the difference in rates, a man aged 65 with average impairment could receive an extra £8,684 income for the first five years of retirement simply by making the right choice."
The following table highlights medical conditions experienced by the over 55s, all of which could qualify for a better annuity rate through an enhanced quote.
|Condition||Percentage of over 55s with condition|
|High blood pressure||40|
|Chronic obstructive pulmonary disease||4|
|Other condition caused by smoking||2|
Source: MGM Advantage
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