On Numerical Problems in Computing Life Annuities Based on the Makeham–Beard Law

Abstract

Analytic expressions for the single and joint life annuities based on the Makeham–Beard mortality law have been derived recently in the literature, which depend on special mathematical functions such as hypergeometric functions. We verify that the arguments of the hypergeometric functions in the analytic expressions for the single and joint life annuities may assume values very close to unity (boundary of the convergence radius), and so numerical problems may arise when using them in practice. We provide, therefore, alternative analytic expressions for the single and joint life annuities where the arguments of the hypergeometric functions in the new analytic expressions do not assume values close to one.