Finance/Business Paper

    May 19, 2020

Situation

Participating ordinary life policy for $10,000 is sold to an individual, age 35. The following cost data are given:

 

  • Annual premium is $230
  • Total dividends for 20 years is $1613
  • Cash value at end of 20 years is $3620
  • Accumulated value of the annual premiums at 5 percent for 20 years .is $7985
  • Accumulated value of the dividends at 5 percent for 20 years is $2352
  • Amount to which $1 deposited annually at the beginning of each year will accumulate in 20 years at 5 percent is $34.719

 

 

 

 

 

 

Write a 1500 word Paper answering questions below & show all work

  1. Calculate the annual net cost per $1000 of life insurance at the end of 20 years using the traditional net cost method.
  2. Calculate the annual surrender cost index per $1000 of life insurance at the end of 20 years.
  3.  Calculate the annual net payment cost index per $1000 of life insurance at the end of 20 years.

 

 

Must Explain and Show all work

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