Suppose the policy does not have any death benefit, which means if the insured dies thepolicy stops making payments (i.e., ignore Column 3 and 4). Assume the policyholder doesnot surrender the policy before death. (10’)(a) Calculate the internal rate of return (IRR) of this policy for buyers of 65 (the buyer isright before his 65th birthday). Assume the first payment starts one year later. Thatis, the buyer can receive 5800 × 12 at the end of every year. Note: the IRR is such thatthe PV of premium equals the PV of expected benefits. (8’)(b) Suppose there is another financial instrument (e.g., a bond) that can achieve the samelevel of IRR as you calculate in part (a). What is the benefit of the annuity plan,compared with the alternative instrument? (2’)2. Death benefit and IRR. (20’)The death benefit we consider is simpler than the death benefit from the actual plan (ifyou read the document through the link). Assume that if the insured dies within the5

The amount received after giving up a whole life type of insurance policy is called the:

Insurance: An insurance company sells a 1-year term life insurance policy to an 80-year-old woman. The woman pays a premium of $3300. If she dies within 1 year, the company will pay $54,000 to her beneficiary. According to the U.S. Centers for Disease Control and Prevention, the probability that an 80-year-old woman will be alive 1 year later is 0.9398. Let X be the profit made by the insurance company.Part: 0 / 20 of 2 Parts CompletePart 1 of 2(a) Find the probability distribution.The probability distribution is

Suppose we are in 2022. An insurer has to make a guaranteed payment to a policyholder in five years (2027) of $1,469, a lump-sum policy payout on retirement, equivalent to investing $1,000 at an annually compounded rate of 8 percent over five years. To protect itself, the insurer has bought a six-year maturity bond paying 8% annual coupons with an 8% YTM that has a duration of 4.993 or approximately 5 years. The face value of this bond is $1000. If the interest rates fall to 7%. At the end of fifth year, which of the following statements is FALSE?A.The insurer receives the proceeds from selling the bond at the end of fifth year of $1,009B.The insurer receives an reinvestment income of $60.C.The insurer has matched the maturity of its liabilties with that of its assets. D.The insurer receives coupons of $400.E.The insurer is immunized from interest rate risk.

The probability is .99 that a 30-year-old man will survive one year. An insurance company offers to sell a man P150,000.00 one-year term life insurance policy at a premium of P2,200.00. What is the company’s expected gain?

The probability that a 22-year-old female in the U.S. will die within one year is approximately 0.00044. If an insurance company sells a one-year, $30,000 life insurance policy to such a person for $135, what is the company's expectation? (Round your answer to the nearest dollar.)$