Abc insurance company has accepted a life insurance application which contains unanswered questions. the company then makes the application part of the life contract. in this situation, the insurer has
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On Aug. 6, D submitted an application for a $50,000 life insurance policy and did not pay the initial premium. On Aug. 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on Aug. 20, and D explains what had recently taken place with the doctor. What action should the producer then take? a) Collect the initial premium. b) Collect the initial premium along with a signed health statement. c) Explain to the applicant that the policy is no longer in effect due to a change in health condition. d) Collect the initial premium and leave a binding receipt.
Nick J.
An insurance company sells a one-year term life insurance policy to an 80-year-old woman. The woman pays a premium of $1,000. If she dies within one year, the company will pay $20,000 to her beneficiary. According to the CDC, the probability that an 80-year-old woman will be alive one year later is 0.9516. Complete the following to determine the expected value of selling such a life insurance policy. a.) What are the possible outcomes of the policy for the insurance company? What is the probability of each? b.) For each outcome from (a), how much money does the insurance company make or lose? c.) Find the expected value of the policy for the insurance company. Then, interpret the expected value.
Supreeta N.
a life insurance company has found there is a 3% probability that a randomly selected application contains an error. assume applications are mutually independent in this respect. an auditor randomly selects 100 applications. calculate the probability that exactly 95 of the selected applications are error free a. 0.08 b. 0.15 c. 0.10 d. 0.18 e. 0.13
David N.
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