Question

An insurance company sells a $12,000, five-year term life insurance policy to an individual for $640....

An insurance company sells a $12,000, five-year term life insurance policy to an individual for $640. Find the expected return for the company if the probability the individual will live for the next five years is 0.98. (Round your answer to the nearest cent.)

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Suppose a life insurance company sells a ​$190,000 ​one-year term life insurance policy to a 20​-year-old...
Suppose a life insurance company sells a ​$190,000 ​one-year term life insurance policy to a 20​-year-old female for ​$330. The probability that the female survives the year is 0.999502. Compute and interpret the expected value of this policy to the insurance company.
1.A man purchased a $21,000, 1-year term-life insurance policy for $350. Assuming that the probability that...
1.A man purchased a $21,000, 1-year term-life insurance policy for $350. Assuming that the probability that he will live for another year is 0.985, find the company's expected net gain. 2.A man wishes to purchase a life insurance policy that will pay the beneficiary $20,000 in the event that the man's death occurs during the next year. Using life insurance tables, he determines that the probability that he will live another year is 0.95. What is the minimum amount that...
1. An insurance company sells a $90,000 one-year term life insurance policy for a premium of...
1. An insurance company sells a $90,000 one-year term life insurance policy for a premium of $458. Find the expected value to the company of a single policy if 99.53% of the insured people survive one year. A. $35 B. $55 C. $458 D. $89,542 2. 47% of all people in a community favor the development of a mass transit system, while only 18% of the people in that community both favor it and do not own a car. If...
a 30 -year old woman purchases a $200,000 term life insurance policy for an annual payment...
a 30 -year old woman purchases a $200,000 term life insurance policy for an annual payment of $460. Based on a period life table for the U.S. Government, the probability that she will survive the year is 0.999051. Find the expected value of the policy for the insurance company. Round to two decimal places for currency problems.
And insurance company sales a one year term life insurance policy to an 80-year-old woman. The...
And insurance company sales a one year term life insurance policy to an 80-year-old woman. The woman pays a premium of $1000. If she dies within one year the company will pay $20,000 to her beneficiary. According to the US centers for disease control and prevention the probability that a 80-year-old woman will be a live one year later is 0.9516. But X be the profit made by the insurance company. Found the probability distribution in the ass but the...
6. A 35-year-old woman purchases a $100,000 term life insurance policy for an annual payment of...
6. A 35-year-old woman purchases a $100,000 term life insurance policy for an annual payment of $360. Based on a period life table for the U.S. government, the probability that she will survive the year is 0.999057. Find the expected value of the policy for the insurance company. need a step by step description via excel
A $200,000 life insurance term policy costs $150 for 5 years of coverage for a 30...
A $200,000 life insurance term policy costs $150 for 5 years of coverage for a 30 year old male. If the male dies during those 5 years, the insurance company pays their family $200,000. If he survives those 5 years, the insurance company will have collected the $150 premium. The insurance company knows a 30 year old has a 0.000176 probability of dying over 5 years. What is the expected profit for the insurance company on this policy?
A man has a 0.193% chance of passing away during the next year. An insurance company...
A man has a 0.193% chance of passing away during the next year. An insurance company charges $370 for a life insurance policy that pays a $120,000 death benefit. What is the expected value for the person buying the insurance? If necessary, round your answer to the nearest cent.
An individual purchases a $525 catastrophic damage policy from an insurance company or the individual receives...
An individual purchases a $525 catastrophic damage policy from an insurance company or the individual receives $50,000 if they are affected by a catastrophic during the year if the probability of encountering a catastrophic during the year is 0.000423 find the expected value of the policy for the individual
A 20-year-old female purchases a 1-year life insurance policy worth $250,000. The insurance company determines that...
A 20-year-old female purchases a 1-year life insurance policy worth $250,000. The insurance company determines that she will survive the policy period with probability 0.9995. (a) If the premium for the policy is $300, what is the expected profit for the company? (b) At what value should the insurance company set its premium so its expected profit will be $250 per policy for 20-year-old females?