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What is the minimum amount to pay for premium

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Reference no: EM131559352

Qusetion: LIFE INSURANCE PREMIUMS A man wishes to purchase a 5-yr term-life insurance policy that will pay the beneficiary $20,000 in the event that the man's death occurs during the next 5 yr. Using life insurance tables, he determines that the probability that he will live another 5 yr is .96. What is the minimum amount that he can expect to pay for his premium? Hint: The minimum premium occurs when the insurance company's expected profit is zero.

Reference no: EM131559352

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