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The Durham Insurance Company sells a five-year term insurance policy with face value of $100,000 to a 47-year-old man for a monthly premium of $63. The mortality table is given below.
The Durham Insurance Company sells a five-year term insurance policy
d. What is the insurance company's profit on this policy?
e. If 8,000 men aged 47 bought one of these policies, about how many would die at age 50? Round to the nearest integer.
f. What is the annual premium for this policy?
g. Assume a policyholder pays the premium annually. What is the profit of this policy for each year of death?
The Durham Insurance Company sells a five-year term insurance policy
h. What is the expected profit from selling one of these policies? Round to the nearest cent.
i. What is the expected profit from selling 8,000 of these policies?
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