CM1 Formula Sheet Page 1

Subject CM1
Formula Sheet
2024
Introduction
This document summarises some of the important formulae required in the Subject CM1 exam.
This document is not an exhaustive list. It is suggested students are comfortable with the
contents of this document by the time of the exam, without needing to refer to it in the exam
itself. Students ought to be able to evaluate assurances and annuities through integration
methods where appropriate. The formulae associated with these integration methods are not
provided here.

Space has been left in the margins allowing students to add their own notes as studies progress.

Where appropriate, formulae are provided referencing the three tables in the Formulae and
Tables for Actuarial Examinations:

 ELT15, page 67
 AM92, page 73
 PMA92 and PFA92, page 109

Note that the mortality tables listed above do not include the same information. Generally
speaking ELT15 and AM92 are used for single life annuities / assurances, where PMA92 and PFA92
are used for joint life annuities/assurances. As students progress through their studies, other
smaller nuances with regards to the tables ought to become clear.

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0 Financial mathematics basics

0.1 Rates of interest / discount / force of interest

Symbol Meaning Calculation Method
Effective rate of interest (i may also be used
i n/a
for simple interest)
Rate of interest convertible pthly. This is not
i (p) i (p)  p[(1  i)1 p  1]
an effective rate
 1 
v Effective discount factor  1  i  or 1  d 
 
 i 
d Effective rate of discount  1  i  or 1  v  or  iv 
 
Rate of discount convertible pthly. This is not
d (p) d (p)  p[1  (1  i)1 p ]
an effective rate
 Force of interest Ln 1  i 

0.2 Level annuity certain

Symbol Meaning Calculation Method
PV of annuity certain payable in arrears
an 1  vn
Present value of payments of 1 made at the
end of each year for n years i
PV of annuity certain payable in advance
a 1  vn
n Present value of payments of 1 made at the  (1  i) an
start of each year for n years d
PV of annuity certain payable continuously
an 1  vn
Present value of payments of 1 made
continuously each year for n years 
AV of annuity certain payable in arrears
sn (1  i)n  1
Accumulated value of payments of 1 made at  (1  i )n an
the end of each year for n years i
AV of annuity certain payable in advance
s (1  i)n  1
n Accumulated value of payments of 1 made at
the start of each year for n years d
AV of annuity certain payable continuously
sn (1  i)n  1
Accumulated value of payments of 1 made
continuously each year for n years 
Note: when there is no possibility of confusion with a life annuity, the term ‘annuity’ can be used
as an alternative to annuity certain.

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0.3 Increasing annuity certain

Symbol Meaning Calculation Method
PV of an increasing annuity certain payable in
arrears 
an  nv n
(Ia)n
Present value of increasing payments made at i
the end of each year for n years
PV of an increasing annuity certain payable in
) advance 
an  nv n
(Ia n Present value of increasing payments made at d
the start of each year for n years
PV of an increasing annuity certain payable
continuously throughout the year
Present value of increasing payments, where
the payment is made continuously throughout
the year, for n years

an  nv n
(Ia )n


PV of a continuously increasing annuity certain

continuously throughout the year
Present value of a continuously increasing
payment, where the payment is made
continuously throughout the year, for n years

( Ia )n an  nv n


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0.4 Pthly payable annuity certain

Symbol Meaning Calculation Method
PV of annuity certain payable pthly in Where:
arrears 1  vn
a(p)  i( p) 
p
n Present value of payments of 1 pa, payable i (p) 1    (1  i)
pthly in arrears  p 
 
AV of annuity certain payable pthly in
arrears (1  i)n  1 i (p)  p (1  i)1/ p  1
s(p)
n Accumulated value of payments of 1 pa, (p)  
i
payable pthly in arrears
PV of annuity certain payable pthly in Where:
a(p) advance 1  vn  d ( p) 
p
n Present value of payments of 1 pa, payable d ( p) 1    (1  d )
 p 
pthly in advance 
AV of annuity certain payable pthly in
advance (1  i)n  1 d (p)  p 1  (1  d )1/ p 
s(p)  
n Accumulated value of payments of 1 pa, d (p)
payable pthly in advance  p 1  (1  i )1/ p 
 

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1 Life probabilities
Symbol Meaning Calculation Method
Probability that a life aged x dies in the next t l x t l x  l x t
t qx t qx  1  
years lx lx

qx Probability that a life aged x dies in the next 1 qx  d x lx

year
Probability that a life aged x survives l
t px t px  x t
the next t years lx

1  qx
px Probability that a life aged x survives the next
1 year or use px  lx 1 l x

n px  t q x  n
Probability that a life aged x survives the next  n px  nt px or nt q x  n qx
n|t q x n years, but then dies in the subsequent t
l l
years  x  n x  n t
lx

n px  q x n
Probability that a life aged x survives the next
n|q x l l d
n years, but then dies in the subsequent 1 year  x  n x  n1  x  n
lx lx

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2 Assurances

2.1 Level Life Assurances (payments at end of the year)

Symbol Meaning Calculation method
Whole of Life
Using AM92, tabulated at 4% and 6%
Ax Lump sum paid at end of year of death
Using PMA92/PFA92 then Ax  1  dax
of a life aged x exact
1
A1 A A
x:n x:n x:n

A  v n n px
Term Assurance x:n
Lump sum at end of year of death of a Using AM92, if x+n=60 or 65, then A is
A1 x:n
x:n life aged x exact, only if life dies within n
tabulated at 4% and 6%. If not, then:
years
Ax  v n n px Ax  n
Using PMA92/PFA92 then use formulas as
x
above, calculating Ax  1  da
Using AM92, and PMA92/PFA92:
Pure Endowment
1 v n n px
A Lump sum at end of term if a life aged x
x:n Using AM92 at 4%:
exact survives term of n years
Dx n Dx
1
A1 A
x:n x:n

Endowment Assurance  Ax  v n n px Ax n  v n n px
Lump sum at end of year of death of life
A Using AM92, if x+n=60 or 65, then A is
x:n aged x exact, if life dies within n years. If x:n
life survives, then payment at time n tabulated at 4% and 6%
Using PMA92/PFA92 then use formulas as

above, calculating Ax  1  da x:n
Deferred whole of Life
Lump sum paid at end of year of death
n|Ax v n n px Ax  n
of life aged x exact, provided life
survives first n years.
Deferred Term Assurance
Lump sum at end of year of death of life
1
m|Ax:n aged x exact, only if life dies within n v m m px A1
x  m:n
years, starting after m years, provided
life survives first m years

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2.2 Level Life Assurances (payable immediately)

Symbol Meaning Calculation method
Whole of Life Ax  (1  i )0.5 Ax
Ax Lump sum paid immediately on death of Using Ax formula on previous page
x Ax  1   ax
Term Assurance A1  (1  i)0.5 A1
x:n x:n
A1 Lump sum paid immediately on death of
x:n
x, only if life within n years Using A1 formula on previous page
x:n
1
A1  A  (1  i)0.5 A1  v n n px
Endowment Assurance x:n x:n x:n
Lump sum paid immediately on death of
A
x:n x, if life dies within n years. If life Using A1 formula on previous page
x:n
survives, then payment at time n
Ax:n  1   ax:n
Deferred whole of Life
n|Ax Lump sum paid immediately on death of v n n px (1  i)0.5 Ax  n
x, provided life survives first n years.
Deferred Term Assurance
Lump sum paid immediately on death of
1
m|Ax:n x, only if life dies within n years, starting v m m px A1
x m:n
after m years, provided life survives first
m years

2.3 Simple Increasing Life Assurances (payable at end of the year of death)
Symbol Meaning Calculation method
Whole of Life
(IA)x Increasing lump sum paid at the end of Using AM92, this is tabulated at 4% and 6%
year of death of x
Term Assurance
Increasing lump sum paid at the end of Using AM92 at 4% and 6%
(IA)1
x:n year of death of x, only if life within n (IA)x  v n n px (IA)x n  nAx  n 
years
Using AM92 at 4% and 6%:
Endowment Assurance 1
Increasing lump sum paid at the end of (IA)1  nA
x:n x:n
(IA)x:n year of death of x, if life dies within n
years. If life survives, then payment of n  (IA)x  v n n px (IA)x n  nAx n 
at time n
 nv n n px
Deferred Whole of Life
Increasing lump sum paid at the end of
n|(IA)x v n n px (IA)x  n
year of death of x, provided life survives
first n years.

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2.4 Simple Increasing Life Assurances (payable immediately on death)

Symbol Meaning Calculation method
Whole of Life Using AM92 at 4% and 6%
(IA)x Increasing lump sum paid immediately
 (1  i)0.5 (IA)x
on death of x
Using AM92 at 4% and 6%
Term Assurance
 (1  i)0.5 (IA)1
(IA)1 Increasing lump sum paid immediately x:n
x:n
on death of x, only if life within n years
 (1  i)0.5 (IA)x  v n n px  (IA)x n  nAx  n 
 
Using AM92 at 4% and 6%:
Endowment Assurance
 (1  i)0.5 (IA)1  nv n n px
Increasing lump sum paid immediately x:n
(IA) on death of x, if life dies within n years.
x:n  (1  i)0.5 (IA)x  v n n px  (IA)x n  nAx n 
If life survives, then payment of n at  
time n
 nv n n px
Deferred Whole of Life
Increasing lump sum paid immediately
n|(IA)x v n n px (IA)x n
on death of x, provided life survives first
n years.

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3 Annuities

3.1 Level Life Annuities (annual payments at start / end of year)

Symbol Meaning Calculation method
Whole life immediate annuity-due
Using AM92, tabulated at 4% and 6%
ax Regular payments in advance as long as
Using PMA92/PFA92, tabulated at 4%
life is alive
Whole life immediate annuity
ax ax 1
Regular payments in arrears as long as
live is alive
Using AM92, if x+n=60 or 65, then ax:n is

a Temporary immediate annuity-due tabulated at 4% and 6%

x:n Regular payments in advance during If not, then using AM92 or PMA92/PFA92,
term as long as life is alive, up to n years can be calculated:

ax  v n n px 
ax n
Using AM92, if x+n=60 or 65, then ax:n can
be calculated as:
Temporary immediate annuity 
ax:n  (1  v n n px )
ax:n
Regular payments in in arrears during If not, then using AM92 or PMA92/PFA92,
term as long as life is alive, up to n years can be calculated:
a x  v n n px a x  n
 (
ax  1)  v n n px (
ax  n  1)
a Guaranteed annuity-due
x:n Whole of life immediate annuity-due 
an  v nn px 
ax  n
with n years guaranteed
a Guaranteed annuity
x:n Whole of life immediate annuity in an  v nn px ax n
arrears with n years guaranteed
Deferred whole life annuity-due
 Regular payments in advance as long as
n ax v nn px ax  n
life is alive, provided life survives first n
years.
Deferred whole life annuity
Regular payments in arrears as long as v n n px a x  n
n ax
life is alive, provided life survives first n
years.

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3.2 Level Life Annuities (continuous annual payments)

Symbol Meaning Calculation method
Whole life continuous immediate
annuity
ax  ax  12
Continuous payments as long as life is
alive
Using AM92, if x+n=60 or 65, then ax:n can
be calculated as:
Temporary continuous immediate
annuity  
ax:n  12 (1  v n n px )
ax:n
Continuous payments made as long as If not, then using AM92 or PMA92/PFA92,
life is alive, up to n years can be calculated:
 
ax  v n n px 
ax n  12 (1  v n n px )
Guaranteed continuous immediate
annuity
a
x:n an  v nn px ax n
Continuous payments as long as life is
alive, with n years guaranteed
Deferred whole life continuous annuity
n ax Continuous payments as long as life is v n n px a x  n
alive, provided life survives first n years.

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3.3 Simple Increasing Life Annuities (annual payments at start / end of year)
Symbol Meaning Calculation method
Increasing life immediate annuity-due
)x
(Ia Increasing regular payments in advance Using AM92, this is tabulated at 4% and 6%
as long as life is alive
Increasing life immediate annuity
(Ia)x Increasing regular payments in arrears )x  
(Ia ax
as long as live is alive
Increasing temporary immediate
annuity-due
)
(Ia Increasing regular payments in advance )x  v n n px [(Ia
(Ia )x  n  na
x  n ]
x:n
during term as long as life is alive, up to
n years
Increasing temporary immediate
annuity
(Ia)x:n Increasing regular payments in arrears (Ia)x  v n n px [(Ia)x n  nax  n ]
during term as long as life is alive, up to
n years
Deferred increasing life annuity-due
)x Increasing regular payments in advance
n|(Ia )x  n
v nn px (Ia
as long as life is alive, provided life
survives first n years
Deferred increasing life annuity
Increasing regular payments in arrears
n|(Ia)x v nn px (Ia)x  n
as long as life is alive, provided life
survives first n years

3.4 Simple Increasing Life Annuities (continuous annual payments)

Symbol Meaning Calculation method
Increasing life immediate continuous
(Ia )x annuity )x  1 
 (Ia a
Increasing regular payments payable 2 x
continuously as long as life is alive
Increasing temporary immediate
continuous annuity
(Ia )x:n Increasing regular payments payable (Ia )x  v n n px (Ia )x  n  nax  n 
continuously as long as live is alive, up
to n years
Deferred increasing life continuous
annuity
n|(Ia )x Increasing regular payments payable v nn px (Ia )x  n
continuously as long as life is alive,
provided life survives first n years

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3.5 Annuities payable non-annually

Note that some of the below formulae can be seen on page 36 of Formulae and Tables for
Actuarial Examinations.

Symbol Meaning Calculation method

Whole life immediate annuity-due
payable pthly ( p1)
ax(p)  ax  2p
Regular payments payable pthly in
advance as long as life is alive
Whole life immediate annuity payable
pthly ( p1) (p1)
a(xp)  ax  2 p  ax  2p
Regular payments payable pthly in
arrears as long as life is alive
Using AM92, if x+n=60 or 65, then ax:n is
Temporary immediate annuity-due tabulated at 4% and 6%
a(p)
x:n
payable pthly
Regular payments payable pthly in
 
a
x:n
p 1

 2 p 1  v n n px 
advance during term as long as life is If not, then using AM92 or PMA92/PFA92,
alive, up to n years can be calculated:

a (p)  
ax( p)  v n n px 
ax(p)n
x:n
Using AM92, if x+n=60 or 65, then ax:n is
Temporary immediate annuity payable tabulated at 4% and 6%

a(p)
pthly
Regular payments payable pthly in
 
a
x:n
p 1

 2 p 1  v n n px 
x:n
arrears during term as long as life is If not, then using AM92 or PMA92/PFA92,
alive, up to n years can be calculated:
a(p)  a(xp)  v n n px a(xp)n
x:n
Guaranteed annuity-due payable pthly
a(p) Whole of life immediate annuity-due 
a(p)  v nn px 
ax( p)n
x:n n
payable pthly with n years guaranteed
Guaranteed annuity payable pthly
a ( p) Whole of life immediate annuity in
a(p)  v nn px a(xp)n
x:n arrears payable pthly with n years n
guaranteed
Whole life deferred annuity-due
payable pthly
( p)
n ax Regular payments payable pthly in v nn px ax(p)n
advance as long as life is alive, provided
life survives first n years
Whole life deferred annuity payable
pthly
(p)
n ax Regular payments payable pthly in v nn px a(xp)n
arrears as long as life is alive, provided
life survives first n years

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4 Joint Life probabilities

Symbol Meaning Calculation Method
Probability that the joint life status fails
t q xy within t years, ie the probability that at 1  t px t py
least one of x and y dies in next t years
Probability that the joint life status is
still active in t years’ time, ie the
t pxy t px t py
probability that both x and y survive for
at least t years
Probability that the last survivor status
t q xy fails within t years, ie the probability t q x t qy
that both x and y die in next t years
Probability that the last survivor status
is still active in t years’ time, ie the 1  t qx t qy
t pxy
probability that at least one of x and y  t px  t py  t px t py
survive for at least t years
Assuming same age and mortality:
t q1
Probability that life x dies first in the
1
t q 1  t q xx
xy next t years
xx 2
Assuming same age and mortality:
t q2
Probability that life x dies second in the
1 1 2
t q 2  t qxx   t qx 
xy next t years
xx 2 2

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5 Joint Life Assurances

Symbol Meaning Calculation Method
Joint whole of life assurance
Ax:y Assurance payments made at the end of year of x:y
1  da
first death, whenever that occurs
Joint whole of life assurance payable immediately 1   ax:y or
Ax:y Assurance payments made immediately on the first
death, whenever that occurs 
1  i 0.5 1  dax:y 
Last survivor whole of life assurance Ax  Ay  Ax:y or
Ax:y Assurance payments made at the end of year of

1  da
second death, whenever that occurs x:y

Last survivor whole of life assurance payable

immediately Ax  Ay  Ax:y or
Ax:y
Assurance payment made immediately on second 1   ax:y
death, whenever that occurs
Joint life n-year term assurance
A
1 Assurance payment made at the end of year of the Ax:y  v n n px n py Ax  n:y  n
x:y:n first death, provided that occurs within the next n
years
Joint life n-year immediately payable term
A assurance
1
Ax:y  v n n px n py Ax n:y n
x:y:n Assurance payment made immediately on the first
death, provided that occurs within the next n years
Joint life n-year pure endowment
A 1
Assurance payment payable at time n, provided v n n px n py
x:y:n
both lives are still alive.
Joint life n-year endowment assurance
Assurance payment made at the end of year of the A1  A 1 or
Ax:y:n x: y:n x:y:n
first death, provided that occur within the next n
years, or at time n, provided both lives are still 1  da
x:y:n
alive.
Joint life n-year endowment assurance A  A 1 or
1
Ax:y:n Assurance payment made immediately on the first x:y:n x:y:n
death, provided that occur within the next n years 1   ax:y:n
or at time n, provided both lives are still alive.

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6 Joint Life Annuities

Symbol Meaning Calculation Method
Joint life immediate annuity-due
ax:y Annuity payable in advance until the death of the first Using PMA92/PFA92, tabulated at 4%
life, x or y, whenever that occurs
Joint life n-year temporary immediate annuity-due
a Annuity payable in advance until the death of the first 
ax:y  v n n px n py  ax  n:y  n
x:y:n
life, whenever that occurs, for a maximum of n years
Joint life immediate annuity
ax:y Annuity payable in arrears until the death of the first life, ax:y  1
whenever that occurs
Joint life n-year temporary immediate annuity
ax:y:n Annuity payable in arrears until the death of the first life, ax:y  v n n px n py ax n:y n
whenever that occurs, for a maximum of n years
Joint life continuously payable immediate annuity
ax:y Annuity payable continuously until the death of the first ax:y  0.5
life, whenever that occurs
Joint life n-year temporary immediate annuity
continuously payable
ax:y:n ax:y  v n n px n py ax  n:y  n
Annuity payable continuously until the death of the first
life, whenever that occurs, for a maximum of n years
Last survivor immediate annuity-due
a Annuity payable in advance until the death of the second 
ax   ay  
ax:y
x:y
life, whenever that occurs
Last survivor n-year temporary immediate annuity-due
a Annuity payable in advance until the death of the second 
ax:n   ay:n  
ax:y:n
x:y:n
life, whenever that occurs, for a maximum of n years
Last survivor immediate annuity
ax:y Annuity payable in arrears until the death of the second ax  ay  ax:y
life, whenever that occurs
Last survivor n-year temporary immediate annuity
ax:y:n Annuity payable in arrears until the death of the second ax:n  ay:n  ax:y:n
life, whenever that occurs, for a maximum of n years
Last survivor continuously payable immediate annuity
ax:y Annuity payable continuously until the death of the ax  ay  ax:y
second life, whenever that occurs
Last survivor n-year temporary continuously payable
immediate annuity
ax:y:n Annuity payable continuously until the death of the ax:n  ay:n  ax:y:n
second life, whenever that occurs, for a maximum of n
years
ay  ax:y
ax|y Reversionary annuity 
   
ay  1  
ax:y  1 
& Annuity beginning on the death of life x, for the
ax|y remaining lifetime of life y  
ay  
ax:y

 
ax|y

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