Partner’s Pension

This option is not usually relevant to single people but most couples choose to have a pension that benefits their surviving spouse or partner. This option means that, when you die, an income is paid to your surviving partner for the rest of his or her life.

Your partner need not be your wife or husband; any person of either sex may be eligible for a partners pension, although some companies will insist that you can show that persons financial dependency on you. Financial dependency may also need to be proven if, and when the dependant’s annuity comes into payment. The partner’s pension is sometimes called a spouses pension, or a reversionary pension because the income reverts to your partner.

Partner’s pensions are usually only payable to the person named at the outset. However, if you are married, it is possible for this benefit to be payable to any spouse. This means that providing you are married when you die, the benefit will be paid to your then spouse, i.e., to take account of remarriage. If you want the benefit to be payable to any spouse, it will restrict the choice of providers, which may reduce the amount of income payable to you.

You can usually choose how much of your income is to be paid to your partner when you die. This can be as high as 100% depending on the type of pension scheme you are in. Most couples, however, opt for an income between 1/3rd and 2/3rds of the annuitant’s pension. The more you choose to be paid to your partner, the lower your own income will be. Also, the age of your partner will affect your income. The younger he or she is, the lower the income to you will be. Please note that with some pension types, a spouse’s pension must be provided.

Indicative Cost Comparison

Figures based on male aged 65, with a 60 year old spouse no escalation, no guarantee period and payable annually in advance. Source: The Annuity Bureau – April 2008