Multiple Decrement Tables 4. [10 marks] You have been given a multiple decrement table with decrements...

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Multiple Decrement Tables 4. [10 marks] You have been given a multiple decrement table with decrements due to accidental death and deaths due to death from other causes. Fred, 40 has recently been diagnosed with Parkinson's and is worried his risk of accidental death has increased. He decides to buy a 5 year term accidental death policy. His policy has a face amount of 250K if he dies but if the cause is accidental then the payout will be 500K. State 1 will be accidental death, state 2 will be death from other causes. The variable dx() reflects number of deaths due to state 1 and dx(2) reflects number of deaths due to state 2. Using an effective rate of interest of 5%, calculate the net annual premium that he will be required to pay based on the equivalence principle. X lx dx(1) dx(2) 40 10000 10 100 41 20 150 42 30 200 43 40 250 44 50 300 45 60 350 46 70 400 Multiple Decrement Tables 4. [10 marks] You have been given a multiple decrement table with decrements due to accidental death and deaths due to death from other causes. Fred, 40 has recently been diagnosed with Parkinson's and is worried his risk of accidental death has increased. He decides to buy a 5 year term accidental death policy. His policy has a face amount of 250K if he dies but if the cause is accidental then the payout will be 500K. State 1 will be accidental death, state 2 will be death from other causes. The variable dx() reflects number of deaths due to state 1 and dx(2) reflects number of deaths due to state 2. Using an effective rate of interest of 5%, calculate the net annual premium that he will be required to pay based on the equivalence principle. X lx dx(1) dx(2) 40 10000 10 100 41 20 150 42 30 200 43 40 250 44 50 300 45 60 350 46 70 400