Answered step by step
Verified Expert Solution
Question
1 Approved Answer
You have been considering buying whole life policy for P50 000.00. Such type of coverage usually has an annual premium of P400.00. The coverage is
- You have been considering buying whole life policy for P50 000.00. Such type of coverage usually has an annual premium of P400.00. The coverage is participating, and based on the insurers history with similar policies. It is expected that the insurer will pay P250.00 per year as dividends for the first twenty (20) years. The cash value for each of the 20 years will be P200.00. Both dividends and cash value have not been adjusted for time value of money. For calculations involving the time value of money, 5 percent is the appropriate interest rate.
- What is the surrender cost per thousand per year? [6 marks]
- What is the net payment cost per thousand per year? [5 marks]
- Traditional net cost method [5 marks]
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Financial Intelligence
Authors: Income Mastery
1st Edition
1647773210, 978-1647773212
