CPS: More Retirees opt For Life Pension, Rises 7.4%

There are indications that pension contributors under the Contributory Pension Scheme, CPS, are now opting for life pension (annuity policy) in the hope that they will live longer after retirement. An annuity policy enables the contributors to receive pension payment monthly throughout their lifetime.

Consequently, insurance firms have recorded Year-on-Year, YoY, growth of 7.4 per cent in annuity business with the number of contributors rising to 3505 in the first quarter of 2023, Q1’23, from 3264 recorded in the first quarter of 2022, Q1’22.

On the other hand, the alternative policy known as Programmed Withdrawal (PW) which pays pension within a lifespan determined by the Pension Fund Administrators, PFAs, have recorded a 24.8 per cent decline to 6415 contributors in Q1’23 from 8528 recorded in Q1’22. The Pension Reform Act 2014 stipulates that a pension contributor at retirement can choose PW or Annuity.  Vanguard