• Kalpesh Agrawal

Deferred Annuity and its formula

Let's understand Deferred Annuity.

  • A deferred annuity is one for which the first payment starts in some future time.

  • Consider an annuity with n unit payments for which the first payment is due at time m + 1.

  • This can be regarded as n-period annuity-immediate to start at time m. Its present value is denoted by,

Thus, we have

Written by: Kalpesh Agrawal (Jr. Actuarial Officer)

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