Traditional Whole Life Insurance

APLII EXERCISE 2 Traditional Whole Life Insurance – Prospective Method   FALL  2021  

 

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APLII INPUT:

DEATH BENEFIT [APLII B3] = $250,000

ISSUE AGE [APLII A7] = 24,

RISK RATE CLASS [APLII D3] = STANDARD

GUARANTEED INTEREST RATE [APLII G3] = 2.5%

CURRENT INTEREST RATE [APLII H3] = 5.0%

 

  • What is the Traditional Whole Life Premium, Cash Value @65 and Paid-Up Insurance @65 using the 2001 CSO Table [APLII F3]?

 

Male                                                                Female

Premium          CV@65            Paid-Up@65    Premium          CV@65            Paid-Up@65

 

  1. Payable for 76 years =                      =                      =                      =                      =                     =

 

  1. Payable to age 65 =                      =                      =                      =                      =                     =

 

  1. Payable for 20 years =                      =                      =                      =                      =                     =

 

  1. Single Payment =                      =                      =                      =                      =                       =

 

  1. What is the explanation for the difference in premiums?

 

  1. Why are the some of the Cash Values and Paid-Up Values equal?

 

 

 

 

 

 

  • What are the Traditional Whole Life Premiums, Cash Values @65 and Paid-Up Insurance @65 using the 2017 CSO Table [APLII F3]?

 

Male                                                                Female

Premium          CV@65            Paid-Up           Premium          CV@65            Paid-Up

 

  1. Payable for 76 years =                      =                      =                      =                      =                     =

 

  1. Payable to age 65 =                      =                      =                      =                      =                     =

 

  1. Payable for 20 years =                      =                      =                      =                      =                     =

 

  1. Single Payment =                      =                      =                      =                      =                       =

 

 

 

  • Change the 2.5% Guaranteed Interest Rate [APLII G3] to 3.5%

 

  1. What happened to the Guaranteed Cash Values?
  2. Explain why by referring to the Prospective Premium Determination and Valuation method.

 

 

 

 

 

 

 

 

 

 

  • What is the Net Amount of Insurance Protection being purchased at the age of, for the premium payment periods below, using the 2017 CSO Table [APLII F3]?

 

Male                                                                Female

Age = 35          Age = 65          Age = 85          Age = 35          Age = 65            Age = 85

 

  1. Payable for 76 years =                      =                      =                      =                      =                     =

 

  1. Payable to age 65 =                      =                      =                      =                      =                     =

 

  1. Payable for 20 years =                      =                      =                      =                      =                     =

 

  1. Single Payment =                      =                      =                      =                      =                       =

 

  1. What are some insurance funding financial observations from above?

 

 

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