The Variation in Some Annuity Payouts Has Exploded
August 9, 2022 by David Blanchett and Branislav Nikolic
Single premium immediate annuities (SPIAs) can provide retirees with an incredibly valuable way to generate guaranteed lifetime income. Payout rates, which represent the annual income divided by the premium, vary both across insurance providers and over time.
There are a number of different components that insurers consider when determining the respective payout rate for SPIA, such as the current interest rate environment, general mortality assumptions, the focus on generating new business, etc. Since each insurer approaches these considerations differently, there is likely to be a variation in the quotes available.
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