Life annuities

Residency requirements

We'll issue a policy only if the policyholder and annuitant(s) are Canadian residents. There is an exception if the policyholder has an existing Sun Life Financial policy with a contractual right to purchase a payout annuity.

Life annuity types

• Single life annuity
• Joint life annuity
   

Issue ages

• Registered (including locked-in funds): ages 18 to 100*
• Non-registered: ages 0 to 100*

*Subject to legislation

Premiums

• Minimum amount: $5,000 (combined total from all sources)
• Maximum amount: $5 million*

*Applications with premiums $5 million and over are subject to review. Special pricing may apply. 

Premium sources

• Registered retirement savings plan (RRSP)
• Registered retirement income fund (RRIF)
• Locked-in retirement account (LIRA)
• Deferred profit sharing plan (DPSP)
• Life income fund (LIF)
• Locked-in retirement income fund (LRIF)
• Registered pension plan (RPP) funds
• Non-registered funds
   

Payment deferral periods

Payments may be deferred for a maximum of 10 years, subject to restrictions based on the source of premium.

Guarantee periods

• 0 - 40 years, subject to restrictions based on the source of premium
   

Payment frequency

• Monthly, quarterly, semi-annually or annually
   

Payment options

• Level payments.  Payment amount remains the same throughout the payment period.
• Indexed payments. Income increases yearly by a fixed percentage. You select an increase between 1% and 4% at purchase. Not available for prescribed annuities.
• Reducing payment (joint life annuities). Income reduces by a certain percentage selected at issue when one of the annuitants dies.
• Integrated payment. Income decreases when CPP, QPP or OAS payments begin. Not available for prescribed annuities.
• Registered funds are subject to legislative restrictions.
   

Taxation

• Registered. Income from an annuity purchased with registered funds is fully taxable to the policyholder in the year it's received.
• Non-registered. Only a portion of the income from an annuity purchased with non-registered funds is taxable. The amount of tax and when it is payable depends on the tax treatment the annuity qualifies for.
• Withholding tax. Canadian withholding tax is mandatory for annuities purchased with RPP (locked-in and non-locked-in), LIF or DPSP premiums.
   

Death benefit

Death benefits depend on whether income has started, the source of premium and the guaranteed period chosen.

Surrender

A payout annuity cannot be partially or fully surrendered and has no cash surrender value.

Essential Care Annuity

If you have a life-shortening condition, we'll consider issuing an enhanced life annuity. This can result in a lower premium or higher income than for someone of the same age and gender without a health impairment. You must provide acceptable medical evidence and special underwriting rules will apply.