Photo AI

This is an Insurance Question - Junior Cycle Business Studies - Question 4 - 2017

Question icon

Question 4

This-is-an-Insurance-Question-Junior Cycle Business Studies-Question 4-2017.png

This is an Insurance Question. Answer all parts of this question: Lisa Bergin, born on 21 July 1975, lives at Rosemary Street, Roscrea, Co. Tipperary. She is a sol... show full transcript

Worked Solution & Example Answer:This is an Insurance Question - Junior Cycle Business Studies - Question 4 - 2017

Step 1

Write the letter that David sent to Lisa on 15 May 2017 explaining the difference between Endowment Assurance and Whole Life Assurance.

96%

114 rated

Answer

High Street
Birr
Co. Offaly
15 May 2017

Ms Lisa Bergin
Rosemary Street
Roscrea
Co. Tipperary

Re: Endowment and Whole Life Assurance

Dear Lisa/Dear Ms Bergin,

I am writing following your request seeking information on the difference between Endowment and Whole of Life Assurance policies.

Endowment Assurance is where an agreed amount of money is paid when the insured reaches a certain age or on the death of the insured whichever occurs first. Whole Life Assurance is where an agreed amount of money is paid to the person’s dependants when the person dies.

If you need any further advice please do not hesitate to contact me.

Yours sincerely,

David Long/David

Step 2

Following David's advice Lisa decides to purchase a Whole Life policy. Assume you are Lisa, using today's date, complete the proposal form on page 11 of Section A.

99%

104 rated

Answer

Complete the proposal form based on personal details, including:

  • Name: Lisa Bergin
  • Date of Birth: 21 July 1975
  • Address: Rosemary Street, Roscrea, Co. Tipperary
  • Occupation: Soldier
  • Health Declaration: Non-smoker, no health issues.

Step 3

What is the title of the person in an insurance company who calculates the premium?

96%

101 rated

Answer

Actuary

Step 4

Calculate the insurance premium that Lisa will have to pay. Show your workings.

98%

120 rated

Answer

Insurance calculation:

  • House: €240,000
    Rate: €16 per €15,000
    Calculation:
    rac{240,000}{15,000} imes 16 = €256.00

  • Contents: €70,000
    Rate: €28 per €5,000
    Calculation:
    rac{70,000}{5,000} imes 28 = €392.00

  • Less Discount (15% on contents):
    Calculation:
    15 ext{% of } €392 = €58.80
    Total Contents Premium after Discount:
    392.0058.80=333.20€392.00 - €58.80 = €333.20

  • Total Premium:
    256.00+333.20=589.20€256.00 + €333.20 = €589.20

Join the Junior Cycle students using SimpleStudy...

97% of Students

Report Improved Results

98% of Students

Recommend to friends

100,000+

Students Supported

1 Million+

Questions answered

;