PREMIUMS
Tom Hornet purchases $7,000 of ten-year term life. He is 31 years old 1. What is his annual premium? 2. What is his quarterly premium?
1. Work: First find the persons age and the insurance rate under the correct policy. A 31year olds rate is 5.07 . Next, take the face value of there policy and divide it by 1000. 7,000 divided by 1000 is 7. Lastly take the insurance rate times the answer to the division problem between the rate and the face value. 7 times 5.07 is $35.49 Answer: $35.49 2. Take annual premium times the % at the bottom of the legend. $35.49 times 26% ( or 0.26) Answer: $9.23 3. Work: Take the quarterly premium times 4, because quarterly means you pay 4 times a year. 9.23 times 4 is 36.92. Now subtract that # from the annual premium. 36.92- 35.49= 1.43 Answer:$1.43
Emily Webster purchased a twenty-year endowment policy at age 27 with a face value of $25,000. 1. What is her annual premium? 2. What is her semi-annual premium? 3. The difference between these payment options? (Remember to compare annual premium to annual premium!)
1. Work: See question 2 Answer: 1,058.50 2. Work; Take annual premium times the % at the bottom of the legend. 1,058.50 times 51% ( or 0.51) Answer: $539.84 3. Work: Take the semi-annual premium times 2, because semi- annually means you pay 2 times a year.$ 539.84 times 2 is $1,079. 68 Now subtract that # from the annual premium. 1,079.68- 1,058.50= $21.20 Answer: $21.18
All insurance companies charge the same rate for a given person.
False
Tom Harris is twenty-four. He purchases $15,000 of ten-year term insurance. 1. semi-annually 2. quarterly 3. monthly
Work: Find the annual premium. First find the persons age and the insurance rate under the correct policy. A 24 year olds rate is 4.15 . Next, take the face value of there policy and divide it by 1000. 15,000 divided by 1000 is 15. Lastly take the insurance rate times the answer to the division problem between the rate and the face value. 15 times 4.15 is $62.25 Answer: $62.25 1. Take annual premium times the % at the bottom of the legend. $62.25 times 51% ( or 0.51) Answer: 431.75 2. Work: Take annual premium times the % at the bottom of the legend. $62.25 times 26% ( or 0.26) Answer: $16.19 3. Work: Take annual premium times the % at the bottom of the legend. $62.25 times 9% ( or 0.09) Answer: $5.60
George Anderson has $30,000 of twenty-payment life. If he is thirty-six years old, what premiums will he pay? 1. semi-annually 2. quarterly 3. monthly
Work: First find the annual premium. See question 3 Answer: $ 846.90 1. Work: Take annual premium times the % at the bottom of the legend. $846.90 times 51% ( or 0.51) Answer: $431.19 2. Work: Take annual premium times the % at the bottom of the legend. $846.90 times 26% ( or 0.26) Answer: $220.19 3. Work:Take annual premium times the % at the bottom of the legend. $846.90 times 9% ( or 0.09) Answer: $76.22
Use the table above to find the yearly premiums in each of the following cases. Emily Ruth Webster is twenty-seven. She is purchasing twenty-year endowment insurance, with a face value of $25,000. What is her annual premium?
Work: First find the person age and the insurance rate under the correct policy. Since she is a woman subtract her age by 3 and use that #. A 24 year olds rate is 42.34. Next take the face of there policy and divided it by 1,000. 25,000 divided by 1000 is 25. Lastly take the insurance rate times the answer to the division problem between the rate and face value. 25 times 42.34 is $1,058.50 Answer: $1,058.50
Tom Harris, a young father, is twenty-four years old. He wishes to purchase $7,000 of a ten-year term insurance. What will be his annual premium?
Work: First find the persons age and the insurance rate under the correct policy. A 24 year olds rate is 4.15 . Next, take the face value of there policy and divide it by 1000. 7,000 divided by 1000 is 7. Lastly take the insurance rate times the answer to the division problem between the rate and the face value. 7 times 4.15 is $29.05 Answer: $29.05
Use the table above to find the yearly premiums in each of the following cases. George Anderson takes out $30,000 of a twenty-payment life insurance. If he is thirty-six years old, what annual premium does he pay?
Work: First find the persons age and the insurance rate under the correct policy. A 36 year olds rate is 28.23. Next, take the face value of there policy and divide it by 1000. 30,000 divided by 1000 is 30. Lastly take the insurance rate times the answer to the division problem between the rate and the face value. 30 times 28.23 is $846.90 Answer: $ 846.90
Use the table above to find the yearly premiums in each of the following cases. Will C. Lowe wishes to purchase an ordinary whole life insurance policy with a face value of $50,000. What will his annual premium be, if his age for insurance purposes is fifty-one?
Work: First find the persons age and the insurance rate under the correct policy. A 51 year olds rate is 34.55. Next, take the face value of there policy and divide it by 1000. 50,000 divided by 1000 is 50. Lastly take the insurance rate times the answer to the division problem between the rate and the face value. 50 times 34.55 is $1,727.50 Answer: $1,727.50