A 5-year term assurance is issued to a 55-year-old, with sum assured $50,000 in the first year, reducing by $10,000 each year. Level premiums, payed in advance for the last 3 years (unless the policyholder dies sooner), are to be implemented. Assume an interest rate of 6% per annum, initial expenses of $100, renewal expenses equal to 10% of that year's premium (so, no renewal expenses for year 2) and 3-year select mortality rates from the table: Age, x 9[x] 9[x-1]+1 9[x-2]+2 qx 55 0.004474 0.005703 0.006524 0.008441 56 0.004865 0.006252 0.007202 0.009419 57 0.005283 0.006844 0.007941 0.010497 58 0.005727 0.007482 0.008744 0.011686 59 0.006197 0.008169 0.009616 0.012994 Calculate the value of the premiums assuming: a) they are paid annually and benefits are paid at the end of year of death. [5 marks] b) they are paid annually and benefits are paid at the time of death. [3 marks] c) they are paid monthly and benefits are paid at the time of death. [3 marks] A 5-year term assurance is issued to a 55-year-old, with sum assured $50,000 in the first year, reducing by $10,000 each year. Level premiums, payed in advance for the last 3 years (unless the policyholder dies sooner), are to be implemented. Assume an interest rate of 6% per annum, initial expenses of $100, renewal expenses equal to 10% of that year's premium (so, no renewal expenses for year 2) and 3-year select mortality rates from the table: Age, x 9[x] 9[x-1]+1 9[x-2]+2 qx 55 0.004474 0.005703 0.006524 0.008441 56 0.004865 0.006252 0.007202 0.009419 57 0.005283 0.006844 0.007941 0.010497 58 0.005727 0.007482 0.008744 0.011686 59 0.006197 0.008169 0.009616 0.012994 Calculate the value of the premiums assuming: a) they are paid annually and benefits are paid at the end of year of death. [5 marks] b) they are paid annually and benefits are paid at the time of death. [3 marks] c) they are paid monthly and benefits are paid at the time of death. [3 marks]