892 - Logical Reasoning

Question: A life insurance company allows people to prepay their endowment insurance at current rates. The policyholder then pays the premium every year. People should participate in the program as a means of decreasing the cost for their living after retirement.
Which of the following, if true, is the most appropriate reason for people NOT to participate in the program?

1. Peoples are unsure about which insurance company they will choose after retirement.
2. The amount of money accumulated by putting the prepayment funds in an interest-bearing account today will be greater than the total cost of insurance when they retire.
3. The annual cost of premium is expected to increase at a faster rate than the annual increase in the cost of living.
4. Some of the insurance companies are contemplating large increases in premium next year.
5. The prepayment plan would not cover the cost of hospitalization.