How To Calculate Fixed Annuity? 
Only insurance companies write annuities . An annuity is calculated based upon the life expectancy of the annuitant . The number of annuitants who make it to the next year is fairly high , the following year , somewhat fewer and so on until you reach life expectancy . At that point half of the annuitants will have died . Then the mortality tables illustrate that every year the percentage of survivors will be reduced significantly and the number who die will accelerate . However . some will make it to 110 but that is all in the actuarial calculation . Spreading the risk over many lives allows the insurance company to make accurate projections of the amount of money they will need to provide the promised benefit . 