If Jean's monthly premium for €100,000 Term Assurance cover is €8.50, what would the total monthly premium be for €250,000 cover, including all fees?

• A. €8.50
• B. €18.50
• C. €21.25
• D. €24.25

Answer: (D)

To find the total monthly premium for €250,000 of Term Assurance cover based on the given premium for €100,000, it's essential to recognize that the relationship between the coverage amount and the premium amount is typically linear.

If Jean's monthly premium for €100,000 is €8.50, you can establish a ratio to calculate the premium for €250,000 by reasoning that if the coverage is increased to 2.5 times (from €100,000 to €250,000), the premium would also increase proportionately.

Here's the calculation:

1. First, determine the cost per €100,000 of coverage: €8.50.

2. Multiply that monthly premium by 2.5 (since €250,000 is 2.5 times €100,000):

• €8.50 x 2.5 = €21.25.

This total of €21.25 represents the base premium for the €250,000 cover. When considering a total cost that might include additional fees or charges that are standard in these policies, it is common to see these fees pushed the total amount higher.

In this scenario, the answer indicates that the total worst-case scenario including all possible fees would round