An Insured Annuity is an arrangement that involves the purchase of two contracts: a life annuity and a life insurance policy. The combination of these contracts creates a locked-in, fixed income investment that is typically attractive to individuals who are retired or approaching retirement. The objective is to provide a better after-tax rate of return than traditional fixed income investments, while preserving the capital through life insurance.
- Guaranteed, tax efficient income for life.
- Guaranteed death benefit.
- Annuity income qualifies for the pension income tax credit.
- Potential to outperform the after tax rate of return of traditional fixed income investments such as GIC’s.
- Worry free financial management.
- Potential to reduce or eliminate the Old Age Security claw back.