Final answer:
To calculate the new annual premium on a 20 year $1,000,000 term life policy for a 30 year old female, you need to multiply the current premium by the increase percentage and add it back to the current premium.
Step-by-step explanation:
To calculate the new annual premium on the 20 year $1,000,000 term life policy for a 30 year old female, you need to multiply the current premium by the increase percentage and add it back to the current premium.
Step 1: Calculate the increase amount by multiplying the current premium by 8% (or 0.08). Increase amount = Current premium * 0.08.
Step 2: Add the increase amount to the current premium to get the new annual premium. New annual premium = Current premium + Increase amount.
Let's assume the current premium is $5000. Plug in this value into the formula above to find the new annual premium.
New annual premium = $5000 + ($5000 * 0.08) = $5400.