Pension annuity
The product in brief
For individuals
Pension annuity: lifelong payments from your pension savings
A pension annuity is a contract with a life insurance company under which the savings in your individual pension account at the Unified Accumulative Pension Fund (UAPF) are transferred to the insurer, and in return it undertakes to pay you an agreed amount regularly for life. Payments can start earlier than the standard retirement age and do not stop even when the transferred amount has formally been “used up”. The calculator above gives a preliminary estimate of the payment, and the Dynasty insurance agency will help you collect and compare quotes from several licensed insurers before you sign.
The decision is irreversible. Once your savings have been transferred to an insurer, they cannot be returned to the UAPF. The contract can be moved to another life insurance company only in the manner and within the time limits established by law, taking the surrender value into account. That is why offers must be compared before signing, not after.
Legal basis
The procedure for concluding the contract and the requirements for it are set by legislation: the laws on pension provision and on insurance activity, the Civil Code, regulations of the financial market regulator and the rules for making pension payments. These documents determine the age, the methodology for assessing whether savings are sufficient, the minimum payment and the indexation requirements.
Who can conclude a contract
Two conditions must be met at the same time: reaching the established age and having enough in your pension account to fund the minimum payment.
| Category | Age guideline | Comment |
|---|---|---|
| Men | As a rule, from 55 | Age parameters are reviewed periodically |
| Women | As a rule, from 53 or later depending on year of birth | Check the current value for your date of birth |
| Holders of mandatory occupational pension contributions | Earlier than the general age | Savings from these contributions are taken into account |
| Group I or II disability established permanently | Regardless of age | Provided savings are sufficient |
| Spouses | Joint contract | Savings are combined |
Sufficiency of savings
The insurer must provide a payment no lower than the minimum set by the regulator. So the younger the person and the longer the expected payment period, the more savings are needed. The calculation takes into account age, gender, the guaranteed period and indexation. With the same amount of savings, the payment can differ noticeably from one insurer to another.
Guaranteed period
The period during which payments are made in any case. If the recipient dies, the remaining payments go to the beneficiary or heirs. The longer the period, the lower the monthly payment.
Indexation
The contract provides for an annual increase in the payment at no less than the level set by law. Compare not only the starting amount but also the indexation rate.
Annuity or payments from the UAPF
| Criterion | Payments from the UAPF | Pension annuity |
|---|---|---|
| Start | From the standard retirement age | Earlier, if conditions are met |
| Duration | While funds remain in the account | For life |
| Longevity risk | Borne by the recipient | Taken on by the insurer |
| Inheritance | The account balance is inherited | Payments within the guaranteed period are inherited |
| Reversibility | Funds stay in the fund | The transfer is irreversible |
What else the contract gives you
If, after transferring the amount needed for the minimum payment, funds remain in your pension account, the law generally allows them to be used for purposes it specifies — for example, improving housing conditions or paying for medical treatment. That is why people often take out the contract not only for an early pension.
Documents
- Identity document
- Statement from your individual pension account
- Bank details for payments
- Beneficiary details
- Disability certificate — if applicable
- Marriage certificate — for a joint annuity
How to apply
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Assessment
Get a fresh UAPF statement and make a preliminary calculation in the calculator above.
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Comparison
We request quotes from several insurers using the same data and compare payment, indexation and guaranteed period.
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Contract and transfer
You sign the contract and apply for the transfer of your savings, after which payments begin.
Joint annuity for spouses
A joint contract combines the savings of both spouses: payments go to both, and after one of them dies — to the surviving spouse. This helps meet the sufficiency threshold when one spouse does not have enough savings. Check at what level payments continue to the surviving spouse.
How to choose a company and avoid mistakes
- Licence and stability. An annuity is a contract for decades; the insurer’s reliability matters more than a one-off gain.
- Compare several quotes. Deciding on the basis of a single offer is a common mistake.
- Balance payment and indexation. The highest starting amount without good indexation loses out over time.
- Beneficiary. Without one, the family will receive the balance for the guaranteed period through inheritance.
- Current statement and rules. Check your account balance and the terms for surrender and contract transfer.
Let us compare offers before you sign
Make a preliminary calculation in the calculator above and leave a request. Dynasty’s specialists will assess whether your savings are sufficient, gather insurers’ quotes and go through the contract terms with you.
This material is for information only and is not a public offer or individual financial advice. Age requirements, the sufficiency methodology, the minimum payment and indexation are determined by the legislation of the Republic of Kazakhstan — check the current values.
Frequently asked questions
Can savings be returned to the UAPF?
No, the transfer of savings under a pension annuity contract is final. The only option is to move the contract to another life insurance company in the manner and within the time limits established by law.
Do I have to stop working to receive an annuity?
No. Receiving payments under the contract is not tied to leaving employment — you can keep working and receive the annuity.
What happens to the payments if I die?
If this happens within the guaranteed period, the remaining payments go to the beneficiary or heirs. After the guaranteed period ends, the insurer’s obligations to the heirs cease.
Can the payment be increased after the contract is signed?
The payment amount is fixed by the contract and grows through the indexation it provides for. Savings received later can be used for a separate contract if the amount is sufficient.
Are the payments taxed?
The taxation of pension payments is governed by tax legislation. Check the withholding procedure with the insurer when concluding the contract.
What happens if the insurance company ceases operations?
The legislation provides mechanisms to protect obligations under annuity contracts, including a system for guaranteeing insurance payouts. Even so, the insurer’s financial stability remains an important selection criterion.
How accurate is the calculator’s result?
The calculator gives a preliminary estimate based on typical parameters. The insurer calculates the exact payment based on your UAPF statement, age, gender and chosen guaranteed period.