Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1. Assume that insurers operate in an environment where price regulation does not exist. Describe two potential benefits that this type of system provides to consumers as well as two potential costs.

2. Define agency costs and discuss whether these costs reduce business value.

3. Describe the common objectives that employers have for their firmâ??s benefits plan and indicate whether employees value the benefits package equally, and/or in the same manner as the employer.

4. How do insurers control for adverse selection problems in health insurance products?

5. What are the advantages associated with using a modeling approach (e.g., vs. using historical data) to estimate expected losses from catastrophic events?

Please show all work in an Excel file for the following problems:

6. ABC Life is interested in selling a five-year, single premium life insurance policy with the following features:

- Death benefit of $200,000.
- Death benefits are payable at the end of the year.
- Each policyholder will pay a single premium at the beginning of policy year one.
- A total of 20,000 policies will be sold to males aged 45
a. Using the mortality information provided below and a 6 percent rate of return assumption, what is the single premium ABC Life should charge each insured?
Beginning of Year Age Probability
of Death During Year
1 45 .0044
2 46 .0047
3 47 .0052
4 48 .0058
5 49 .0064

b. find out the level annual premium for the same policy (i.e., what amount would the insured have to pay each year, for 5 years, for this coverage?).

7. ABC Property and Casualty is interested in selling coverage to homeowners in a new development. Homes in this development are valued at $500,000. They estimate that losses per exposure (home) will follow the following discrete distribution:

Loss Amount Probability
$500,000 0.005
$100,000 0.01
$50,000 0.03
$25,000 0.05
$10,000 0.07
$5,000 0.10

a. find out the gross premium ABC should charge for full coverage if it includes a 15% loading for administration and profit.

b. How much should ABC charge for a policy with a $10,000 deductible?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M927796

Have any Question? 


Related Questions in Basic Finance

The period of a satellites motion around the earth is 36

The period of a satellite's motion around the earth is 36 hours, that is, it orbits the earth every 1.5 days. Determine the altitude of the satellite above the earth's surface in km.

1 why do savers with small amounts to invest rarely make

1. Why do savers with small amounts to invest rarely make loans directly to individuals or firms? 2. What are transactions costs? What are information costs? 3. What are financial intermediaries? Why are financial interm ...

Learning objective 4 analyze the impact of business

(Learning Objective 4: Analyze the impact of business transactions on accounts) Set up the following T-accounts: Cash, Accounts Receivable, Office Supplies, Office Furniture, Accounts Payable, Common Stock, Dividends, Se ...

1 what is a multiple baseline design and when are such

1. What is a multiple baseline design, and when are such designs typically used? 2. How do researchers analyze the data from single-case experiments? 3. In what areas have single-case experiments been primarily used?

Go to one of the web sites that contain video clips such as

Go to one of the Web sites that contain video clips (such as www.youtube.com) and view some video clips about improving your credit. You can use search phrases such as "improving your credit" or "assessing your credit." ...

The allied group is considering two investments the first

The Allied Group is considering two investments. The first investment involves a packaging machine, which can be used to package garments for shipping orders to customers. The second possible investment would be a moldin ...

Analysis of denver furniture corpdenver furniture corp is

Analysis of Denver Furniture Corp. Denver Furniture Corp. is nationally recognized for making high-quality products. Management is concerned that the company is not fully exploiting its brand power. Denver's production m ...

Why might a company pay as a stock dividend list the three

Why might a company "pay" as a stock dividend? ?. List the three possible explanations for why companies pay cash dividends ? Identify three different methods that a company can use to repurchase its own stock from inves ...

Why is a combination of torque and angle measurement or

Why is a combination of torque and angle measurement or control so popular in mass production operations? What is meant by window control? What is meant by yield control in mass production applications? Does tightening a ...

1 speculate on why accounting standards do not mandate full

1. Speculate on why accounting standards do not mandate full financial statements in interim reports. 2. Why may comprehensive income fluctuate substantially more than net income? 3. Why can pro-forma financial informati ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro