For example, let’s say you subscribe to a pension plan by choosing a deferment period of 10 years. For the next 10 years, you have the pay premiums and build a corpus as per the chosen plan. The amount invested in the fund will continue to earn for the next 10 years. After the completion of this period, the insurer will start paying you annuity as mentioned in the policy schedule. You will get annuity payments based on the value of funds accumulated over these years.