Annuities·7 min read

Fixed Annuities in Illinois: Rates, Carriers, and the State Guaranty Fund

How fixed annuities work for Illinois retirees, what rates look like in 2026, and how the Illinois Life and Health Insurance Guaranty Association protects you.

Key Takeaways

1
Illinois Life and Health Guaranty Association covers annuity contracts up to $250,000 in present value per insured per insurer.
2
MYGA (Multi-Year Guarantee Annuity) rates in 2026 range roughly 5–6% for 3- to 7-year terms.
3
Annuities are tax-deferred — you only pay tax on gains when you withdraw.
4
We compare annuity carriers we're appointed with to find the strongest current rate for your term.

Why retirees in the Northwest Suburbs use annuities

Bank CDs in Illinois currently pay around 4–5% APY for short terms. Fixed annuities typically pay 5–6%+ for similar terms — with full principal protection and tax deferral on the growth.

For retirees who don't need access to the money for several years and want to lock in higher guaranteed rates than CDs offer, MYGA contracts are the natural alternative.

How the Illinois guaranty fund works

The Illinois Life and Health Insurance Guaranty Association (ILHIGA) backs annuity contracts up to $250,000 in present value per insured per insurer if the carrier becomes insolvent. This is in addition to placing your money with carriers we vet for A-rated financial strength.

What we look at when picking an annuity

Current rate (and whether it's locked for the entire surrender period or just year one), carrier financial strength, free withdrawal allowance, and whether the contract includes a market value adjustment if you surrender early.

Source: Illinois Department of Insurance ↗

Annuities