640 Class 4 Outline

640 Class 4 Outline - Class 4 Outline Business Finance 640...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Class 4 Outline Business Finance 640 - Insurance and Risk Winter 2008 1 In this class, we make the transition to Life Insurance. We begin by examining the meaning of premature death, and the economic consequences and costs of premature death. The central premise is that life insurance is economically justified, if a person earns an income, and others are financially dependent on that income, for at least part of that support. We will review three approaches for estimating the amount of life insurance to own. The two basic methods of paying premiums will be examined—yearly renewable term method and level- premium method. From this, we move into a more detailed review of the types of life insurance. The major term insurance and ordinary life insurance products are compared and important variations of Whole Life are reviewed. These include variable life, universal life and variable universal life contracts. While reviewing these variations, we will take a more detailed look at universal life. We will review the major characteristics of the universal life product and spend some time understanding its limitations. A continuing theme will be the trade-off between the savings goal and protection element of life insurance. We will see how this trade-off is manifested in the design of the various life insurance products that we review. I. Premature Death A) Meaning of Premature Death B) Costs of Premature Death C) Chances of Dying Prematurely D) Economic Justification of Life Insurance II. Financial Impact of Premature Death on Different Types of Families
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 07/17/2008 for the course BUSFIN 640 taught by Professor Krempley during the Winter '08 term at Ohio State.

Page1 / 4

640 Class 4 Outline - Class 4 Outline Business Finance 640...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online