Are annuities safe?

Annuities can provide you with a guaranteed income payable for either the rest of your life or a fixed number of years, making them a popular pension type. Despite annuities being run by private businesses, no annuity providers have failed since the Financial Services Compensation Scheme (FSCS) came into being in 2001. 

However, if a provider did fail, the FSCS would compensate you to the value of 100% of the claim (with no upper limit on compensation). You may also be able to purchase protection as part of your annuity, so your beneficiaries may receive the income in case you die.

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