What is 'annuity reserve' in SAP FS-RI - Reinsurance?

annuity reserve - Overview

• Component: FS-RI

• Component Name: Reinsurance

• Description: A special reserve that represents the annuities to be paid that have already been defined in liability and accident insurance.

annuity reserve - Details

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  Key Concepts: 
  Annuity reserve is a component of the Financial Services Reinsurance (FS-RI) module in SAP. It is a reserve that is set aside to cover the future payments of annuities. Annuities are contracts between an insurer and an individual, where the insurer agrees to make periodic payments to the individual in exchange for a lump sum payment. The annuity reserve is used to ensure that the insurer has enough funds to make these payments. 
  
  How to use it: 
  The annuity reserve can be used to calculate the amount of money that needs to be set aside for future annuity payments. This calculation is based on the current value of the annuity, the expected rate of return, and the expected life expectancy of the individual receiving the annuity payments. The annuity reserve can also be used to track changes in the value of the annuity over time. 
  
  Tips & Tricks: 
  When calculating the annuity reserve, it is important to consider any changes in interest rates or life expectancy that may occur over time. This will help ensure that there are enough funds available to make all future payments. Additionally, it is important to review the annuity reserve regularly to ensure that it is up-to-date and accurate. 
  
  Related Information: 
  The FS-RI module also includes other components such as premium reserves, claims reserves, and investment reserves. These