Although you may not have a spouse or maybe any children, but ask yourself do you have anyone dependent on your income whether that be family members children. Even if no one is dependent on your income you may want life insurance to cover any debt you have incurred such as taxes or even future expenses such as funerals and other final expense.
Yes if you were annuity was purchased through a qualified account such as a 401(k) and Ira or 403B all payments will be subject to ordinary income tax. If your annuity was purchased with after-tax dollars you will receive the earnings first which are taxable as ordinary income. Once you have received all of your earnings payments will be made from the premiums you made to policy which I received a tax free. If you purchase an income rider on your annuity once your account value has been exhausted you will continue to receive guarantee payments for life, however those payments will be received income taxable.