nother year is 0.99786 based on data from the national registry agency. Calculate the insurance premium an insurance company would charge to break even on a 1 year $0.5million term-life insurance policy?
nother year is 0.99786 based on data from the national registry agency. Calculate the insurance premium an insurance company would charge to break even on a 1 year $0.5million term-life insurance policy?
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter8: Insuring Your Life
Section: Chapter Questions
Problem 6FPE
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Question
Insurance underwriting relies heavily on statistics to determine the amount of insurance premium to charge. The probability that a 25-year-old female will live another year is 0.99786 based on data from the national registry agency. Calculate the insurance premium an insurance company would charge to break even on a 1 year $0.5million term-life insurance policy?
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