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8 May, 16:16

Insurance companies always offer a discount If you pay your annual premium as a one-time payment or lump sum. Your

annual premium is $1,200. You will receive a 6% discount If you pay all at once. How much will you save per year?

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Answers (1)
  1. 8 May, 18:48
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    Answer: Your savings per year will be $72

    Explanation: For an insurance premium, premiums are by standard, paid once every month. Hence an insurance policy with an annual premium of $1200 would result in a monthly premium payment of;

    Monthly Premium = 1200 / 12

    Monthly Premium = 100

    However, there is an option to pay all $1200 at once, that is, one lump sum just once in the entire 12-month period and taking that option would offer a discount on the insurance premium which is given as 6% and this is calculated as shown;

    Premium = 1200

    Discount = 0.06 (6 %)

    Discount calculated = 1200 * 0.06

    Discount calculated = 72

    The calculations and result shows that the option of paying the premium at once would result in a savings of $72 per year.
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Home » Business » Insurance companies always offer a discount If you pay your annual premium as a one-time payment or lump sum. Your annual premium is $1,200. You will receive a 6% discount If you pay all at once. How much will you save per year?
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