SOA Exam FAM Sample Question 6.52
Study guide: Exam FAM
For a fully discrete 10-payment whole life insurance of H on (45), you are given:
(i) Expenses payable at the beginning of each year are as follows:
| Expense Type | First Year | Years 2-10 | Years 11+ |
|---|---|---|---|
| Per policy | 100 | 20 | 10 |
| % of Premium | 105% | 5% | 0% |
(ii) Mortality follows the Standard Ultimate Life Table
(iii) i = 0.05
(iv) The gross annual premium, calculated using the equivalence principle, is of the form G = gH + f, where g is the premium rate per 1 of insurance and f is the per policy fee
Calculate f.
[A modified version of Question 11 on the Spring 2017 exam]
- A) 42.00
- B) 44.20
- C) 46.40
- D) 48.60
- E) 50.80
Answer this question and see the worked solution