Alicia Bitman, age 30, plans to purchase a $200,000, 5-year term life insurance policy. What is the annual premium?
1 answer:
Answer: $770
Step-by-step explanation:
Number of units to be purchased by Alicia:
= 200,000 / 1,000
= 200 units
Alicia is purchasing a 5-year term life insurance policy. At age 30, the cost per $1,000 unit of insurance is $3.85 for a female.
The formula for the annual premium is:
= Number of units purchased * Premium per $1,000
= 200 * 3.85
= $770
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