Most People Need Longevity Insurance rather than an Immediate Annuity

摘要

An immediate annuity is precisely the sum of two parts. One is a deferred annuity commencing at a specified date, with no death benefit before that date. The remainder, before the deferred annuity commences, is a reverse whole life insurance policy with limited premiums. That reverse policy is effectively one underwritten by the annuitant, with the insurance company as beneficiary a policy that benefits few retirees. However, the deferred annuity (called "longevity insurance" in the literature) is a valuable component of a retirement portfolio that supplements components that focus on safety and growth.