You are the wage earner in a "typical family," with $60,000 gross annual income. Use the easy method to determine how much life insurance you should carry. O 60,000 O 120,000 294,000 420,000
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- Assume that you have calculated: (a) premiums for life insurance policies and (b) payments to annuitants based upon an assumption that everybody dies before attaining age 101. Now you discover that a significant number of your policy owners are likely to live beyond age 101 and some will live to age 121. How will that affect your business?Use Exhibit 14.2 to estimate the average Social Security benefits for a retired couple. Assume that one spouse has a part-time job that pays $28,000 a year, and that this person also receives another $47,000 a year from a company pension. Assume, that the earnings limit was $17,040 per year. Also assume for Social Security benefits the recipients are aged below 67 and will lose $1 in benefits for every $2 they earn above the earnings test amount. Also assume that they would have to pay taxes of 50% on a combined income between $32,000 and $44,000, of their Social Security benefits. If their combined income is more than $44,000, up to 85% of their Social Security benefits is subject to income tax. Round your answer to the nearest dollar.$ __________ Based on current policies, would this couple be liable for any tax on their Social Security income?-Select: YES or NOMarie wants to provide retirement income for her dependent parents for 35 years should she die. Marie earns $67,500 and feels that her parents could live on 65% of that amount. If the insurance funds could be invested at 5%, how much life insurance does she purchase using the desired income method? Group of answer choices $1,273,499 $1,450,087 $932,743 $877,500
- Your employer pays 70% of your total insurance premium of 8000 per year. How much do you pay as an employee? a. $2,400 b. $6,120 c. $5,600 d. $62 a paycheckUsing the "Human Life Value" method, how much life insurance should you purchase if you have 45 years until retirement, an annual income of $65,100 received at the start of each years, and a time value of money of 9%? (Assume 80% income replacement, ignore taxes and inflation.)Darlene wants to buy a $200,000 term life insurance policy. She is 34 years old. Using the premium table, what is her annual premium for a 10-year policy? a $100 b. $108 C$1.202 d. $1.290
- If a life insurance company insures 50 females age 25 for $40,000, 10- year term policies, how much would they expect to pay out?SolveStandard Insurance is developing a long - life insurance policy for people who outlive their retirement nest egg. The policy will pay out $240 comma 000240,000 on your 82 nd82nd birthday. You must buy the policy on your 65 th65th birthday. The insurance company can earn 55% on the purchase price of your policy. What is the minimum purchase price the insurance company should charge for this policy? Question content area bottom Part 1 What is the minimum purchase price the insurance company should charge for this policy?Insurance underwriting relies heavily on statistics to determine the amount of insurance premium to charge. The probability that a 25-year-old female will live another year is 0.99786 based on data from the national registry agency. Calculate the insurance premium an insurance company would charge to break even on a 1 year $0.5million term-life insurance policy?
- Imagine your uncle is currently earning $200,000 pa and is about to retire. What percent of his current income will Social Security pay?You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $50,000 today or receive payments of $641 a month for 10 years. You can earn 6.50% on your money. What option should you take and why?When you retire, a key goal is to be able replace about 80% of your pre-retirement income level. Social Security will cover a higher percentage of low earners’ needed replacement income than high earners’ replacement income. True or False
