Compare a tontine and an ordinary life annuity at the same death age
A larger annual pension does not automatically produce a larger family payout at every age.
The amount returned before annuity commencement, the pension received while alive, and the guaranteed payments continuing to a beneficiary after death can all differ.
This calculator places two Korean insurance illustrations on the same age timeline so you can see those trade-offs together.
Enter the confirmed monthly premiums, annual annuity amounts, guarantee terms and pre-start payment tables from your actual documents.
The calculator separates owner and future survivor payments, subtracts premiums paid, and discounts the cash flows to the common issue date.
It does not generate a product quote, forecast longevity or calculate a mortality-weighted expected return.
The decision this comparison supports
Find the death age at which the larger tontine pension first exceeds the ordinary annuity’s remaining survivor guarantee, and review the amounts recoverable if the contract ends before commencement.
This is a Korea-specific illustration comparison, with official references checked October 6, 2026.
The search end age is a viewing limit, not a life-expectancy assumption.
Korean tontine structures and commencement bonuses
A tontine structure directs resources toward contracts maintained by long-term survivors.
A Korean partial-payment design may provide lower pre-start death or surrender payments in exchange for more resources supporting the survivor’s annuity.
Do not assume that the name means a zero pre-start death payment: use the final payable amount in the specific illustration.
Pre-start payments
The death benefit and surrender value can be different at the same age.
Neither should be replaced by the displayed account reserve unless the insurer confirms that it is the final amount payable.
Reserve credit or separate cash?
A commencement bonus credited to reserves can already be reflected in the annual annuity.
Adding it again as cash would double-count its value.
Enter separate start cash only when a payment in addition to the quoted pension is confirmed; otherwise use zero.
Use the same declared-interest-rate assumptions and illustration dates for both plans.
Future declared rates, survivor redistribution returns and automatically calculated bonus percentages are outside this model.
Inputs to copy from each illustration
- Common issue age: use the same insured person and valuation date.
Follow the insurance-age basis used in the illustration; the calculator does not convert insurance age to chronological age.
- Monthly premium and payment years: use a fixed KRW monthly amount and whole years.
Advance payments, additional contributions and premium changes require a separate insurer calculation.
- Start age and annual annuity: each plan can have a different commencement age.
The annuity field is KRW per year, not the monthly payment.
- Survivor guarantee: enter the term during which the beneficiary continues to receive 100% of the same monthly annuity after death.
Use zero only if no continuation is confirmed.
- Separate start cash: enter only cash paid in addition to the annuity.
A reserve bonus already incorporated in the pension belongs at zero in this field.
- Pre-start checkpoint table: enter separate final surrender and death payments at whole-age anniversaries.
Blank means unknown; zero means a confirmed absence of payment.
The interface shows issue-to-start years and the deferral period after premiums finish.
Premium completion must be at or before commencement.
Displayed age, money and duration limits are application bounds, not statutory insurance eligibility requirements or product underwriting rules.
The initial premium and pension amounts are blank so an unrequested quote is not presented as a default.
Payment timing and age conventions
Equal month-end cash flows
Premiums are modeled at month end starting one month after issue.
The first pension arrives one month after annuity commencement, using the annual payout divided by 12.
Owner payments include the completed months up to the modeled death.
Death in the commencement month gives zero owner pension months, the full survivor guarantee and any separate start cash already paid under this boundary convention.
Use the event age and additional months to compare a boundary such as age 77 years 6 months.
Pre-start tables accept whole-age anniversaries, so an event with additional months has an unknown settlement.
The calculator does not interpolate between surrender values or apply actual calendar-date proration.
Confirm exact policy dates, payment dates and claim timing with the insurer.
Future guaranteed payments remain included even if they extend beyond the search end age.
For example, a table ending at age 100 does not discard guaranteed payments corresponding to later ages.
The displayed age range and the contract’s guarantee end are separate limits.
Owner payouts, survivor payouts and premiums
Post-start death
Monthly pension = annual annuity / 12
Owner pension = monthly pension × completed months after start
Survivor pension = monthly pension × remaining guaranteed months
Family payout = owner pension + future survivor pension + separate start cash
Nominal net after premiums
Premiums paid = monthly premium × completed contribution months
Nominal net = family payout or pre-start settlement − premiums paid
Difference = tontine result − ordinary result
Present value at issue
Month t discount factor = (1 + annual discount rate)^(−t/12)
Payout present value = sum of each payment × its payment-month discount factor
Net present value = payout present value − premium present value
Family payout includes the beneficiary’s future payments after death; it is not the cash already received on the death date.
Those payments are discounted in their actual future modeled months, not converted into a death-date lump sum.
A higher family payout can still leave a lower net result if its premiums are larger.
A negative nominal net means premiums have not been recovered in this model, rather than a calculated tax, contractual penalty or administrative fee.
Review pre-start death and surrender exposure
Before commencement, the applicable final payment table drives the result.
A death event uses the death payment; a surrender event uses the surrender value.
If only one plan has a confirmed value, that plan can show a result while the comparison difference remains unknown.
Keep missing values blank
A confirmed zero means no money is payable and produces a real unrecovered-premium amount.
A blank means the amount has not been established and withholds that result.
Do not fill unknown cells with zero or substitute death payments for surrender values.
Post-start surrender requires additional contract-specific calculations and is withheld here.
Step-by-step use
- Collect comparable documents.
Match the insured person, issue date, declared-rate assumptions and gross payout basis.
Preserve any genuine premium or duration differences.
- Choose an event and viewing range.
Examine early death and longer survival separately, and use pre-start surrender when relevant.
The final age must include both start ages.
- Copy the pension and guarantee inputs.
Check that annual payout, guarantee term and separate cash refer to the same payout form.
Do not add reserve bonuses twice.
- Add pre-start payment checkpoints.
Copy final death and surrender payments separately at each relevant whole age.
Leave unsupported entries unknown.
- Confirm assumptions and calculate.
Read owner and survivor amounts first, then family total, net after premiums and present value.
Check whether the lead changes after its first crossover.
- Save and reconcile the comparison.
TXT export and printing preserve the assumptions.
Editing an input hides the previous result; calculate again before saving revised values.
Fictional example: why age 75 and age 80 differ
Both fictional plans begin at issue age 40, collect KRW 300,000 per month for 10 years, and commence at age 70.
Each receives KRW 36,000,000 in premiums.
The tontine annual payout is KRW 4,800,000 with no survivor guarantee; the ordinary annual payout is KRW 3,600,000 with a 10-year 100% guarantee.
Separate cash and the discount rate are zero.
These are hypothetical teaching values, not an insurer quote or a market average, and load only when you select the example button.
Fictional death-age family payouts and differences in KRW| Death age | Tontine family payout | Ordinary family payout | Tontine − ordinary |
|---|
| 75 years | 24,000,000 | 36,000,000 | −12,000,000 |
| 77 years 6 months | 36,000,000 | 36,000,000 | 0 |
| 77 years 7 months | 36,400,000 | 36,000,000 | 400,000 |
| 80 years | 48,000,000 | 36,000,000 | 12,000,000 |
At death age 75, the tontine pays KRW 24,000,000 to the owner with no survivor continuation.
The ordinary annuity pays KRW 18,000,000 to the owner and another KRW 18,000,000 over the remaining five guarantee years.
The resulting nominal net values are −KRW 12,000,000 and zero.
At death age 80, the ordinary guarantee has ended and the higher tontine monthly pension produces a KRW 12,000,000 family-payout advantage.
Pre-start checkpoint at age 55
The fictional table contains tontine surrender/death payments of KRW 20,000,000 / KRW 30,000,000 and ordinary payments of KRW 36,000,000 / KRW 38,000,000.
After KRW 36,000,000 of premiums, surrender net values are −KRW 16,000,000 and zero; death net values are −KRW 6,000,000 and +KRW 2,000,000.
An unsupported age 56 or age 55 years 1 month remains unknown rather than receiving an estimated value.
Interpret the first crossover carefully
The monthly search starts when both plans have commenced and ends at the selected final age.
It finds the first death month at which the tontine result is strictly greater for family payout, nominal net and net present value separately.
An exact tie is not counted as a lead: the fictional example ties at 77 years 6 months and first leads at 77 years 7 months.
This is different from the age at which a single plan first recovers its own premiums.
A higher discount rate reduces the value of distant future pension payments.
Different premiums, commencement ages, guarantees or separate cash can therefore produce different crossover ages for the three measures.
No crossover within the viewing range does not establish that no crossover could ever occur.
A first lead can later reverse when plan timings or guarantees differ.
Read the count of subsequent lead changes and the final-age net difference alongside the first crossover.
Review ages before both plans have commenced in the age table separately.
Selecting surrender does not change the death-age curve or crossover search, and none of these ages is a personal lifespan prediction.
Practical scenarios and illustration checks
Concern about early surrender
If retirement, housing or medical expenses might interrupt premium payments, request surrender tables at several pre-start ages.
Assess recoverable cash alongside the longer-survival pension difference rather than relying only on the annual pension headline.
Protecting a surviving partner
A higher owner pension can accompany a smaller future payment to the beneficiary after early death.
Move the death scenario earlier and inspect survivor guarantees, then review other life insurance and public pension resources separately.
Record the contribution and deferral terms, gross-versus-net basis, guarantee start, named beneficiary, and payment-table date before comparing.
Convert amounts shown in ten-thousand-won units into KRW and verify that both documents use the same assumptions.
For a decision focused on choosing a guarantee term, the annuity guarantee-period survivor value calculator also examines the partner’s living-cost gap.
Model limits and Korean withdrawal-right checks
A larger NPV does not account for health, family liquidity needs or estate objectives and does not constitute a purchase recommendation.
Mortality probabilities, life expectancy, future rates, taxes, tax-exemption qualification, joint-life pensions, changing payouts, reduced survivor percentages and lump-sum conversions are not calculated.
If the beneficiary does not continue receiving the full monthly amount, obtain a contract-specific insurer calculation.
For the general protection-product rule checked in 2026, Article 46 of Korea’s Financial Consumer Protection Act uses the earlier of 15 days from receipt of the policy document and 30 days from application.
A longer agreed period, excluded products, an insured event or an applicable special rule requires individual contract review.
Check Enforcement Decree Article 37 as well.
This page does not decide eligibility or calculate a calendar expiry date; confirm the applicable wording, communication method and dispatch evidence with the insurer.
Frequently asked questions
Does early death always mean no tontine payment?
Pre-start death rules depend on the product.
Copy the confirmed final payment from the Korean partial-payment illustration rather than assuming zero from the product name.
Does an ordinary life annuity stop when its guarantee ends?
The modeled owner pension continues while the insured is alive.
The guarantee controls payments remaining for the beneficiary after death, not the owner’s lifetime payment term.
Where should a commencement bonus be entered?
If credited to reserves and already reflected in the annual pension, enter zero separate cash.
Enter a positive cash amount only when the insurer confirms an additional payment independent of the pension.
Is an exact crossover tie already a tontine advantage?
No: equality is not a strict lead.
The example ties at 77 years 6 months and first leads at 77 years 7 months.
Check later lead changes and the age table too.
Does “unknown” mean there is no loss?
It means the applicable payment has not been confirmed.
A confirmed zero is calculated as no payment.
Intermediate-month settlements are not estimated, so request the appropriate insurer figure.
Is family payout the cash received by the death date?
It includes future monthly beneficiary payments over the remaining guarantee.
Those amounts are not an immediately payable lump sum, and present value discounts each future payment separately.
Are taxes or insurance tax exemptions included?
The comparison uses the same gross KRW basis for both illustrations.
Tax qualification, policy loans, additional expenses and actual net payments require individual confirmation.
Are my illustration inputs stored on a server?
The calculator runs in your browser and does not send these inputs to a server or insurer.
TXT export downloads a file to your chosen device, and refreshing the page resets the inputs.
Official references and future updates
Official-source verification date: October 6, 2026.
The Korean National Law Information OPEN API was queried directly for current status and article text.
Financial Consumer Protection Act Law ID 013704 / MST 277247 is effective January 2, 2026; Enforcement Decree Law ID 014044 / MST 285715 is effective April 28, 2026.
These articles support the withdrawal-right explanation, not a universal pension rate or surrender formula.
After a product launch, policy amendment or rate change, recheck the actual annual pension, death and surrender tables, guarantee and separate-cash treatment.
If an insurer’s written figures differ, reconcile the contract conditions and payment timing and use its final contract-specific calculation.
Review both illustrations on one age timeline
Start with the annual payout, then review pre-start recoveries, survivor protection after early death and net receipts under longer survival.
Save the comparison and confirm its assumptions with the insurer so the contract decision reflects the conditions behind the headline pension amount.