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Life Insurance and Death Probability: CNBC Explains

Thursday, 15 Sep 2011 | 12:00 PM ET

For life insurance companies, knowing how much to charge for term life policies is important to ensure statistically that profits and payouts can be made. To do this, the company must understand the likelihood that a policy holder will die while being insured. How is this breakeven point calculated? Salman Khan of the Khan Academy explains.