Index-linked
Index-linked annuities are linked to the retail price index
(RPI). They provide protection against inflation as gross payments are
guaranteed to move in line with changes in the RPI each year.
Index-linked annuities are popular with some retirees
because income from a standard annuity can be eaten into by rising inflation.
This is because the annuity rate you're offered will be fixed at the same level
for the entire payment period.
Bear in mind, however, the starting payments for
index-linked annuities will be much lower than those for level annuities. It
can also take a long time for index-linked annuity payments to catch up with
those offered by level annuities – if it catches up at all.
If you are thinking about an index-linked annuity, talk to
one of our advisers first to ensure it's right for you. You can fill in our
enquiry form and one of our advisers will call you back.