Annuity

An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return, receive regular disbursements, either immediately or at some point in the future. Examples of annuity are regular deposits to a savings account, monthly home mortgage payments, monthly insurance payments and pension payments. The payments may be weekly, monthly, quarterly, half yearly, yearly or at any other regular intervals of time.

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