At Maturity: Apart from 1/3 of the fund value taxfree cash, I will HAVE to buy an annuity from this company (or probably from other companies too). The various annuity plans have different monthly/ yearly amounts depending upon the prevailing long term interest rates, type of annuity and the company's analysis of the policyholder's longetivity (again too many variables to even give a decent approximation). So, even if they look lip-smacking (7-9%) at current rates, they may not be so 10-20 years down the line. Let us analyze this a little further. A 7-9% annuity rate may appear to be good, but if you realise that the amount provided is FIXED for the term of annuity, then that means at an inflation rate of 7-10%, this FIXED amount will start to look small within 5-10 years. And I am not even speaking about 20-30 years down the line. The purchasing power will diminish rapidly later on and this supposedly decent amount will look like a small amount later on.