“A few years ago, I was trying to buy an annuity for a wealthy client, and a provider told me that there comes a tipping point where they will start offering worse rates the more money that is being offered for the annuity,” said Mr Sanmuganathan.
“The reasoning was that clients with that amount of money were more likely to take better care of themselves.
“If you have large sums of money you are going to be able to get the best health treatment. The annuity companies don’t like those big payments as they feel that the person could live forever. They prefer to deal in smaller amounts where the person has a shorter life expectancy.”