Final answer:
Russell should opt for a long-term care insurance policy with a longer term due to increasing life expectancy. An actuarially fair premium for life insurance considers individual group risks and life expectancy differences can be influenced by factors like race and healthcare access.
Step-by-step explanation:
Russell has learned that life expectancy is expected to increase substantially in the coming decades. Given this knowledge, when considering purchasing a long-term care insurance policy, he would logically opt for a policy with a longer term because the chances of needing long-term care would increase as his lifespan extends. An increased life expectancy trend suggests that more individuals will require elder care for longer periods, potentially making long-term insurance policies more valuable.
To calculate an actuarially fair premium for life insurance policies, an insurance company factors in the risks associated with individuals or groups. For example, if dividing 50-year-old men based on family history of cancer, those with a higher risk (1 in 50 verses 1 in 200) will have a higher fair premium.
As life expectancy rates have been rising, it is important to note that socioeconomic factors such as race and ethnicity can impact health outcomes, with certain groups facing higher infant mortality rates or shorter life expectancies and others experiencing reduced access to care.