On 1 January 2005, a life insurance company issued 1,000 10-year term assurance policies to lives aged 55. For each policy, the sum assured is RM50,000 for the first five years and RM25,000 thereafter. The sum assured is payable immediately on death and level annual premiums are payable in advance throughout the term of this policy or until earlier death. The company uses the Illustrative Life Tables for to calculate the premium and reserves. (i) Calculate the net premium retrospective reserve per policy as at 31 December 2009. (ii) Give an explanation of your numerical answer to (i) above. (iii)Describe the main disadvantage to the insurance company of issuing this policy. (iv) Give examples of how the terms of the policy could be altered so as to remove this disadvantage.