Question: 8. [6 marks] Mr. Smith (47) was looking over Equitable Life's Universal Life prod- ucts and has decided to purchased a $100,000 level death benefit

8. [6 marks] Mr. Smith (47) was looking over Equitable Life's Universal Life prod- ucts and has decided to purchased a $100,000 level death benefit Universal Life product. He will pay a premium of $1300 per year for the life of the contract. He will pay expense and COI charges each year. The effective rate of interest is 8% Using the attached table calculate the cost of insurance (COI) charge in policy year 5. AVA 47 0 0.00008 $0 $1,355 48 1 0.00010 $1.355 $2.810 49 2 0.00012 $2,810 $4.385 50 3 0.00015 $4.385 $6.085 51 4 0.00020 $6.085 $7,920 52 5 0.00022 $7.920 $9.900 53 6 0.00024 $9,900 $12,035 54 7 0.00027 $12,035 $14.345

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