CHAPTER 15‐19 TEST.

1) 2.75p62.75
ii) UDD
=0.25𝑝62.75 ∗ 2𝑝63 ∗ 0.5𝑝65
=0.25𝑞62.75 ∗ 2𝑞63 ∗ 0.5𝑞65
. ∗ .
= 1 ∗ ∗ 1 0.5 ∗ 0.02447
. ∗ .
=0.942864
i)0.25𝑝62.75 ∗ 2𝑝63 ∗ 0.5𝑝65
. .
= 1 0.01749 ∗ ∗ 1 0.02447 0.942819

2.)5|4𝑞 56 1 𝑖𝑠 𝑡ℎ𝑒 𝑝𝑟𝑜𝑏𝑎𝑏𝑖𝑙𝑖𝑡𝑦 𝑡ℎ𝑎𝑡 𝑎 𝑝𝑒𝑟𝑠𝑜𝑛 𝑎𝑔𝑒𝑑 56

1, 𝑟𝑖𝑔ℎ𝑡 𝑛𝑜𝑤 57 𝑖𝑠 𝑤ℎ𝑜 𝑡𝑜𝑜𝑘 𝑡ℎ𝑒 𝑝𝑜𝑙𝑖𝑐𝑦 𝑜𝑛𝑒 𝑦𝑒𝑎𝑟 𝑎𝑔𝑜 ℎ𝑎𝑠 𝑡𝑜 𝑠𝑢𝑟𝑣𝑖𝑣𝑒 𝑓𝑜𝑟
5 𝑦𝑒𝑎𝑟 𝑎𝑛𝑑 𝑑𝑖𝑒 𝑤𝑖𝑡ℎ𝑖𝑛 𝑡ℎ𝑒 𝑛𝑒𝑥𝑡 4 𝑦𝑒𝑎𝑟𝑠.
. .
Solution =0.045858
.

3.)i)EPV of deferred whole life annuity=55000*15|𝐴: 63

.
=55000* 1.04 ∗ 0.71238 14345.53
.
.
𝐸 𝑝𝑣 55000 ∗ 1.04 ∗ ∗ 0.52965
.

=325729003.6
𝑉𝑎𝑟𝑖𝑎𝑛𝑐𝑒 𝐸 𝑃𝑉 𝐸 𝑃𝑉
325729003.6 14345.53
= 10951.47
ii) 𝐸𝑃𝑉 𝑜𝑓 𝑡𝑒𝑟𝑚 𝑎𝑠𝑠𝑢𝑟𝑎𝑛𝑐𝑒

= 𝑣 ∗ 𝑡𝑝𝑥 ∗ 𝜇 𝑥 𝑡 𝑑𝑡
. .
= 𝑒 ∗𝑒 ∗ 0.04𝑑𝑡
.
=0.04 𝑒 𝑑𝑡
. . ∗ . ∗
= 𝑒 𝑒
.

=0.1573877
=20000*0.1573877
=3147.75
EPV of pure endowment
. ∗ . ∗
30000 ∗ 𝑒 ∗𝑒

=18195.91
TOTAL EPV =18195.91+3147.91=21343.67

𝐸 𝑃𝑉 𝑜𝑓 𝑡𝑒𝑟𝑚 𝑎𝑠𝑠𝑢𝑟𝑎𝑛𝑐𝑒 = 𝑣 ∗ 𝑡𝑝𝑥 ∗ 𝜇 𝑥 𝑡 𝑑𝑡

∗ . .
= 𝑒 ∗𝑒 ∗ 0.04𝑑𝑡
.
=0.04 𝑒 𝑑𝑡
. . ∗ . ∗
= 𝑒 𝑒
.

=0.220268414
=20000 ∗ 0.220268 55067103.59

. ∗ ∗ . ∗
𝐸 𝑃𝑉 𝑜𝑓 𝑝𝑢𝑟𝑒 𝑒𝑛𝑑𝑜𝑤𝑚𝑒𝑛𝑡 30000 ∗ 𝑒 ∗𝑒
=404396067.7
Total 𝐸 𝑃𝑉 55067103.59 404396067.7=459463171.3
Therefore variance=459463171.3 21343.67 1977.61

4.)EPV of term Assurance

34000 ∗ 𝐴𝑏𝑎𝑟: 60: 8 6000 ∗ 𝐼 𝑇𝐴 𝑏𝑎𝑟; 60: 8
. .
=34000 ∗ 1.04 ∗ 0.45640 ∗ 0.57175
.

. .
6000 ∗ 1.04 ∗ 8.36234 7.50035
.
8 ∗ 0.57175)
=5031.51
5.)𝑎 12 : 50: 20

= 𝑎𝑑𝑢𝑒 12 : 50 𝑣 ∗ 𝑛𝑝𝑥 ∗ 𝑎𝑑𝑢𝑒 12 : 70

.
= 18.843 1.04 ∗ ∗ 11.562
.

=13.6278

6.) EPV of benefit

=5000 ∗ 𝑎𝑑𝑢𝑒: 48: 12 𝑎𝑑𝑢𝑒: 60 ∗ 𝑣 ∗ 12𝑝60
.
=5000*9.613 16.652 ∗
.

=5000*19.51666
=97583.058

7.)EPV of benefit=60000 ∗ 𝐴𝑏𝑎𝑟: 54 3000𝐼𝐴𝑏𝑎𝑟: 54

. .
=60000* 1.04 ∗ 0.37623 3000 ∗ 8.60190 ∗ 1.04
=49337.60

8.) 𝐸𝑃𝑉 𝑜𝑓 𝑡𝑒𝑟𝑚 𝐴𝑠𝑠𝑢𝑟𝑎𝑛𝑐𝑒

=25000 𝑣 ∗ 𝑞70 𝑣 1.019231 ∗ 1|𝑞70 ⋯ … … … … … …till n)
There 𝑣 𝑣 1.019231 4%

= ∗ 𝐴: 70: 22
.
.
= ∗ 0.60097 ∗ 0.85787
. .

=13504.03
EPV of pure endowment
.
=25000* 1.019231 ∗ 1.06 ∗ =1469.54
.

There total pv=13504.03+1469.54=14973.57

9.)EPV of guaranteed annuity=𝑎𝑑𝑢𝑒 12 : 10 𝑣 ∗ 𝑛𝑝𝑥 ∗ 𝑎𝑑𝑢𝑒 12 : 𝑥
𝑛
. .
= 1.06 ∗ ∗ 9.140
. .
.

=200621.49

………………………………………………….. THE END………………………

TIME TAKEN:2HRS 15MINS