Pure Endowment Premium
A pure endowment is the discounted value of an amount payable to a person at a future date if that person is still alive when the payment is due. It is calculated by multiplying the discounted value of the payment by the probability that the person will survive to the future date.
Note: for the sake of consistency with other calculations, the discounted value is referred to as the net single premium ("net", since present and/or future expenses are ingnored).
The Pure Endowment Premium calculation calculates the premium for a given future payment.
Input
| • life table | |
| • current age | |
| • payment at age | |
| • future payment | |
| • nominal annual rate |
Results
| • net single premium |
| • pure endowment factor |
Example
| • | At an interest rate of 4 %, what is the net single premium for an amount of $10,000 payable to a male, now aged 30, if he survives to age 60?
Answer: $2,687.45. |
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