1 st q - describe one 2nd q - explain one 3rd q - a woman one Three problems solve all

Chapter 26 Practice Questions Describe the main features of a unit-linked policy Explain the terms 'unit fund' and 'non-unit fund' in the context of a unit-linked life assurance contract, listing the various items that make up the non-unit fund. A woman now aged exactly 64 has paid 20,000 a year into an accumulating with profits contract at the start of each of the last four years. The policy has incurred the following charges 1,000 deducted at the start of 1 100 deducted at the start of each subsequent year. year . The following rates of regular bonus interest have been applied: 2 3 4 Yeart 3.1% 2.9% 3.2% 3.4% Bonus interest Additionally, there is a terminal bonus on contractual claim, currently payable at the rate of 0.015x(t-1) of the fund value, where t is the number of years the policy has been in force at the time of claim. The policy is now maturing, and the woman is using all of the maturity proceeds to buy a level annuity from the insurance company. The annuity will be payable monthly in advance for a minimum of 5 years and for the whole of life thereafter. Calculate the monthly amount of annuity that the woman will receive, if the insurance company uses the following basis in its annuity pricing: Mortality: PFA92C20 with a 3-year age deduction Interest: 4% po 17] Expenses: 400 initial plus 0.35% of each annuity payment