Why do the returns on Life payment annuity and fixed-term annuity payout differ so much?

It's not one or the other but how much of each.

Retirement can be broken up into two parts. Active retirement where you're still travelling and spending money, and passive retirement where you're just too old and unable to be out and about.

During active retirement, you'll need more money, and during passive retirement, you'll probably need less.

So you can have 2 plans, a limited payout plan for active retirement with a base lifetime annuity for both active and passive retirement.

What kind of comparison are you using?

It seems like a comparison for CPF LIFE and Annuity Plan by another insurer.

There are differences between the 2 if you realised:

(1) CPF LIFE - The payouts drawdown from your capital, and it depletes once it reaches a certain age. The insurer is pooling the risk from everyone (those who pass off earlier, pays for those who are still alive). As such, they can afford to give higher payouts even with the same amount

(2) Fixed Term annuities - They are drawing down from the possible dividends that can be gotten (the bonuses), and are trying to preserve your capital. As such, it draws much less in terms of the amount. They are able to leave a bequest or even mature to provide another lump sum. (after your maturity date).