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Jade wants to buy a $200,000 term life insurance policy. she is 34 years old. using the premium table, what is her annual premium for a 10 year policy? a 5-column table with 6 rows titled annual life insurance premium (per 1,000 dollars of face value). column 1 is labeled age with entries 30, 31, 32, 33, 34, 35. column 2 is labeled 5-year term male with entries 3.98, 4.08, 4.19, 4.30, 4.42, 4.54. column 3 is labeled 5 year term female with entries 3.66, 3.76, 3.87, 3.98, 4.10, 4.22. column 4 is labeled 10-year term male with entries 6.06, 6.13, 6.30, 6.38, 6.45, 6.53. column 5 is labeled female with entries 5.72, 5.79, 5.85, 5.93, 6.01, 6.09. a. $1,290 b. $1,202 c. $6,010 d. $820

Sagot :

Premium rates are often referred to as premium per fixed face value. Jade's annual premium for a 10-year policy of $200,000 is $1,202.

How to calculate the total annual premium for $x?

When it's given that the annual premium is $p per $y face value, then we can calculate the annual premium for $1 face value and then use it to calculate the annual premium for $x. Therefore using proportions, we can write,

$y face value : $p annual premium

[tex]\text{\$1 face value} : \$\dfrac{P}{y}\ \rm annual\ premium[/tex]

[tex]\text{\$x face value} : \$\dfrac{P\times x}{y}\ \rm annual\ premium[/tex]

In the given case, from the tables, we see that for age 34, and 10-year life insurance for the female gender, there is an annual premium of 6.01 per $1000 face value.

Therefore, we will get the value of p = 6.01, and y = 1000.

As mentioned that Jade wants to buy Life insurance for $200,000, therefore, x = $200,000

Putting it in the above-derived formula, we get:

[tex]\text{\$x face value} : \$\dfrac{P\times x}{y}\ \rm annual\ premium[/tex]

[tex]\text{\$200,000 face value} : \$\dfrac{6.01\times 200,000}{1,000}\ \rm annual\ premium = \$1,202\ \rm annual\ premium[/tex]

Hence, Jade's annual premium for a 10-year policy of $200,000 is $1,202.

Learn more about Annual Premium Cost:

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Answer:

b 1,202 on edge 2022

Step-by-step explanation:

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