Chart 22
Well it’s not untypical for upfront costs for selling and underwriting to run 120% of a year’s premium, and
a major function of the selling cost is to avoid the extra deaths by making sure that you insure people who
aren’t as likely to die, i.e an average person who really wasn’t looking for life insurance.  So let’s put that
into our product.
By trial and error you get the fund to come out just right by using a premium of $9.05.  That’s actually
124% of our $7.27 original premium because, remember…
Annual premium with 120% acq costs $9.05