4. A select life aged 60 purchases a 10-year endowment insurance with $100,000 sum insured.Premiums are payable annually in advance and death benefits are payable at the end of the yearof death. Assume that (i) commission is 10% of the first premium and 4% of cach subsequentpremium, (ii) other expenses are $50 at issue, and $5 at each subsequent premium date, (iii)mortality follows the Standard Select Life Table, and (iv) interest is 5% per year. Calculate theannual premium.

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mortality follows the Standard Select Life Table, and (iv) interest is 5% per year. Calculate the annual premium.

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter5: Gross Income: Exclusions

Section: Chapter Questions

Problem 40P

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3. A select life aged 40 purchases a 10-year endowment insurance with $100,000 sum insured. Premiums are payable annually in advance and death benefits are payable at the end of the year of death. Assume that (i) commission is 10% of the first premium and 5% of each subsequent premium, (ii) other expenses are $100 at issue, and $10 at each subsequent premium date, (iii) mortality follows the Standard Select Life Table, and (iv) interest is 5% per year. Calculate the annual premium.
- A select life aged 50 purchases a 10-year endowment insurance with $100,000 sum insured. Premiums are payable annually in advance and death benefits are payable at the end of the year of death. Assume that (i) commission is 12% of the first premium and 3% of each subscquent premium, (ii) other expenses are $60 at issue, and $6 at each subsequent premium date, (iii) mortality follows the Standard Select Life Table, and (iv) interest is 5% per year. Calculate the annual premium.
Consider a 25-year term insurance issued to a life aged 35 with annual premiums payable throughout the policy term, with sum insured $100,000 payable at the end of the year of death if death occurs during the term. Expenses are as follows: 10% of the 1st annual premium and 2% of each subsequent premium, with an inception expense of $100 and renewal expenses of (at the time of the payment of the 2nd and each subsequent premium) of $15. Calculate the annual premium (using the equivalence principle). Use table D (Standard Ultimate Survival Model) with i=5%.
A special endowment assurance policy is issued to a male aged 55 and a female aged 50 with a term of 20 years. A benefit of $500,000 is payable immediately on the last death of the two lives. There is a survival benefit of $600,000 if both of them are alive; if only one of them is alive, the survival benefit is $400,000. Premiums are payable annually in advance over the term of the policy as long as one of them is alive. The interest rate is 4% per annum and the mortality basis is PA92C20. Calculate the net annual premium for this policy. Correct your answer to the nearest cent.
June Stickney purchased an annuity on January 1, 2019, which, at a 12% annual rate, would yield $6,000 each June 30 and December 31 for the next 6 years. What was the cost of the annuity to Stickney? Round your answer to two decimal places. $ fill in the blank 4 Five equal annual contributions are to be made to a fund, with the first deposit on December 31, 2019. Determine the equal contributions that, if invested at 10% compounded annually, will produce a fund of $30,000 on December 31, 2024. Round your answer to two decimal places. $ fill in the blank 5 Beginning on December 31, 2020, 6 equal annual withdrawals are to be made. Determine the equal annual withdrawals if $11,000 is invested at 10% interest compounded annually on December 31, 2019. Round your answer to two decimal places. $ fill in the blank 6
The proceeds of $493000 death benefit are left on deposit with an insurance company for 10 years at an annual effective interest rate of 18.04 %. The balance at the end of 10 years is paid to the beneficiary in 125 equal monthly payments of X, with the first payment made at the end of 10 month from the end of deposit. During the payout period, interest is credited at an annual effective interest rate of 12.89 %. Calculate X. Answer: 41544.44
A 20-year endowment insurance for a 30-year old pays $80,000 at the moment of death or at age 50, whichever comes first. You are given: i) ii) Mortality is uniformly distributed with w = 120 6 = 0.04 Calculate the expected present value of this insurance.
A life insurance company issues a 10-year term insurance policyto a life aged 50, with sum insured $100 000. Level premiums are payablemonthly in advance throughout the term. You are given the following premium assumptions. (i) Commission is 20% of each premium payment in the first year (incurredat the premium payment times) and 5% of all premiums after the firstyear. (ii) Additional initial expenses are $100. (iii) Claim expenses are $250. (iv) The sum insured and claim expenses are payable one month after the dateof death. (v) Mortality follows the Standard Select Life Table, with UDD betweeninteger ages.(vi) i = 5%. Calculate the gross monthly premium.
The beneficiary of a life insurance policy is to receive $2000 a year for 5 years, the first payment to be made at the time of the death of the injured. Find the value of the annuity at the time of death of injured, assuming the current interest rate to be 4%. Answer: $9259.8
(b) Daniel deposits $5,000 into a fund at the end of each month in the coming five years. The fund earns 6% p.a. compounded monthly. (i) Calculate the amount in the fund at the end of the fifth year. (ii) Starting from the sixth year, $X is deducted from the fund for donation to charity at the end of each month continuing forever. Find X.
Calculate the annual premium for the following policy. (Use Table 20.1.) (for females subtract 3 years from the table.) (Round your answer to the nearest cent.) **TABLE ATTACHED***** Amount of coverage (face value of policy) Age and sex of insured Type of insurance policy Annual premium $50,000 27 (F) 20-year endowment
K Seanna O'Brien receives pension payments of $3,200 at the end of every six months from a retirement fund of $53,000. The fund earns 7% compounded semi-annually. (a) How many payments will Seanna receive? (b) What is the size of the final pension payment? (a) The number of payments is (Round up to the nearest whole number.) (b) The size of the final payment is $. (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)