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If an annuity or pension will pay your spouse a survivor’s benefit that is adequate to support his or her lifestyle, then you may not need to a life insurance policy to cover this need.

Annuities are seen as longevity insurance which protect against outliving money, while life insurance protects beneficiaries if the insured person dies younger than expected.

If something happens to you and you have an annuity, your surviving spouse would either continue to receive periodic benefits or take a lump-sum distribution, depending on what kind of payout option you chose when you signed the contract. In the case of the lump sum it may only be for the amount of principal that had not been paid out yet in annuity payments.

Annuities guarantee income for life, in most cases, using a large premium payment, which has normally come from a rollover, and if you would like to make sure your spouse is taken care of, you should elect the joint-life option, which will pay as long as either of you are alive, even if the payment amount is lightly lower than if it were a single-life policy.

As the annuity pays out, it reduces the amount of principal balance, which is generally the only amount left over if a joint-life option is not chosen.

Whether or not a life insurance policy would be a wise addition to your plan depends on the options available in your annuity or pension, and the cost of life insurance premiums. It may be both a single-life annuity or pension and a permanent life insurance policy, such as a guaranteed universal life.

Retirement income can be a trickier subject than many people realize, and some financial planners focus on it entirely.

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