Typical concerns faced by ordinary people - Dying too early, Living too Long, Living with disability
The level premium is a premium fixed such that it does not increase with age but remains constant throughout the contract period.
Premiums collected in early years would be more than the amount needed to cover death claims of those dying at these ages, while premiums collected in later years would be less than what is needed to meet claims of those dying at the higher ages. The level premium is an average of both.
Level premium has two components - Term or protection component and Cash value element
Term or Protection component consists of that portion of premium actually needed to pay the cost of the risk
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