Annuity Rates in Florida

Buying an annuity in Florida can provide income for life, and the absence of a state income tax allows you to keep more of your money.

Explore current annuity rates in Florida below.

Current Annuity Rates in Florida

Buying an Annuity in Florida

Florida has traditionally placed fewer restrictions on annuities, which may translate to less protection for consumers when compared to states like New York and California.

But in May 2023, the Florida House of Representatives and Senate passed House Bill 1185, which introduced a layer of new regulations designed to provide additional consumer protections.

The Florida Department of Financial Services keeps a record of all insurance companies licensed to do business in the state, and annuity companies must also be licensed in Florida to sell in the state. You can search for your annuity company on the Florida Office of Insurance Regulation website.

“There’s a lot of regulation around that for insurance companies,” licensed agent Jonathan Varner told Annuity.org. “Florida does a really good job to protect their seniors.”

Given the size of the state and its high number of retirees, many major providers are licensed in Florida, giving customers an array of choices.

“The products that exist here in Florida maybe don’t exist in other states,” Varner said.

Florida requires insurers that sell annuities to allow a 21-day free-look period for fixed annuities and variable annuities. This gives buyers time to review and consider the terms of their investment. Buyers can cancel their investment without penalty during the free-look period.

I have many clients who choose to move to Florida before purchasing an annuity to avoid state taxation on their annuity income. When facing rising costs and longevity concerns, maximizing income free from taxation becomes crucial.

Another reason my retired clients relocate to Florida is that the specific annuity they desire for their retirement isn’t available in their current state. Moving to Florida grants them access to options that offer several million dollars more in guaranteed lifetime income!

John Stevenson, CFFOwner and Advisor at Stevenson Retirement Solutions

John Stevenson, a Certified Financial Fiduciary®️, specializes in securing retirements with tax-free accounts. With a focus on guaranteed retirement, he’s ensured none of his clients suffer from market fluctuations. As a renowned educator and podcast host, John empowers thousands weekly, sharing his expertise in minimizing taxes and protecting against financial downturns.

Regulations and Taxation in Florida

From a tax perspective, Florida can be an advantageous place to buy an annuity for a couple of reasons.

First, it is one of nine states with no state income tax, which is a major perk for annuity owners and retirees. When you receive payments from your annuity, you may only be subject to federal taxation on the portion deemed income. The same is true for Social Security benefits.

Florida also levies no tax on estates or inheritances.

Like other states, Florida has regulations and suitability standards governing annuity sales.

According to Florida law, an insurer or agent must “have reasonable grounds for believing the recommendation is suitable for the consumer, based on the consumer’s suitability information.”

In addition, the National Association of Insurance Commissioners, or NAIC, further updated its Suitability in Annuity Transactions Model in 2020 to promote consistency among states. 

Florida adopted the NAIC Annuity Transactions Model in May 2023, requiring annuity sellers to document that they understand the customer’s needs, have considered a wide range of solutions and have recommended the best one. It replaces the Florida customer information questionnaire with a nationally standardized one.

The new regulation pertains to any sale or recommendation of an annuity. Moreover, any agent who sells annuities must complete certain training requirements – including courses about the types, uses and taxes of annuities. Agents must also behave ethically and are prohibited from dissuading consumers from providing honest information or filing a complaint.

“Suitability makes sure that people are not being oversold, that they’re not being misrepresented,” Varner said. 

Florida Resources

Florida has regulatory authorities that provide support for state residents. Below is a list of resources that provide direction and assistance with financial products, service companies, financial institutions and collection agencies.

The Florida Department of Financial Services – Division of Consumer Services has a consumer helpline: 1-877-693-5236 (or 850-413-3089 for out-of-state callers). Florida buyers can file complaints by telephone, online or email. In Florida, insurance companies must respond within 20 days to the financial services department after a complaint has been filed. 

The Florida Office of Insurance Regulation “serves Floridians through its responsibilities for regulation, compliance and enforcement of statutes related to the business of insurance.” The site also provides a company search function and other consumer resources.

Additionally, the state’s guaranty association, the Florida Life & Health Insurance Guaranty Association, details the annuity consumer protections for Florida residents.