Plz solve Insurance Planning problems

[psreehari]

Hi,

Can you please provide me the necessary solutions for the problems.

--Jan's present age is 40yrs and wishes to retire at 60.Present salary
is Rs3,50,000 p.a.Total life insurance premium paid Rs30,000.p.a.
(Children+wife's policies)Total tax amounts Rs45,000.Medical expenses
are being reimbursed by the company and self maintenance expenses
Rs 36,000(entertainment+club membership+sports) .Please let me know
the solution ,How to calculate the annuity factor and How to calculate
this in the fin. calculator.

--Mr & Mrs Rao aged 46 & 42,both have a life expectancy of
35yrs.Calculate the insurance required based on need based and income
replacement methods on Mr.Rao's life.
Current investments---Rs25,00,000
Expenses---Rs3,00,000(including 1lakh Mr Rao's personal expenses)
Mr.Rao's post income tax----Rs3.5lakh
Final costs---Rs1lakh
post tax ,post inflation rate/discount rate is 3%

Awaiting your response.

[Moksha Kalyan Ram Abhiramula]

 

Jan's present age is 40yrs and wishes to retire at 60.Present salary
is Rs3,50,000 p.a.Total life insurance premium paid Rs30,000.p.a.
(Children+wife's policies)Total tax amounts Rs45,000.Medical expenses
are being reimbursed by the company and self maintenance expenses
Rs 36,000(entertainment+club membership+sports) .Please let me know
the solution ,How to calculate the annuity factor and How to calculate
this in the fin. calculator.

Solution

Present age = 40

Retirement age = 60

n = 20

 

Savings = Total life insurance premium = PMT = Rs. 30,000/- p.a.

 

PV & FV are required to calculate the annuity factor

 

The question is not complete.

 

Mr & Mrs Rao aged 46 & 42,both have a life expectancy of 35yrs.

Calculate the insurance required based on need based and income replacement methods on Mr.Rao's life.
Current investments---Rs25,00,000
Expenses---Rs3,00,000(including 1lakh Mr Rao's personal expenses)
Mr.Rao's post income tax----Rs3.5lakh
Final costs---Rs1lakh
post tax ,post inflation rate/discount rate is 3%

 

Solution

 

Capital Need Analysis

 

				Rs
Current investments				2,500,000.00
Current expenses				300,000.00
Final costs				100,000.00
Capital available for now				2,100,000.00
Capital required = 300000/.03				10,000,000.00
Less: Capital avaiable				2,100,000.00
Capital required				7,900,000.00

regards

--

Abhiramula Moksha Kalyan Ram 

 
1-73, Mokila Village,
Shankerpalli Mandal,
Ranga Reddy District.
Pin code 501203