Actuaries at Term Life Insurance Company calculated the net single premium per thousand for a five-year term policy for a man age 32 to be $5.04.To calculate the net level premium for this policy,the net single premium should be

Question

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To calculate the net level premium, the net single premium needs to be divided by the present value life annuity due factor for $1 for five years. This is because a level premium is paid annually throughout the term, and the present value of these payments must be equal to the net single premium. Since the policyholder pays the premium at the beginning of each year (annuity due), the present value life annuity due factor should be used.

Actuaries at Term Life Insurance Company Calculated the Net Single