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Dividend Addition

Definition of "Dividend addition"

Beverley Knopp
  Keller Williams

Option in a participating policy under which dividends are used to purchase fully paid-up units of whole life insurance. This option deserves careful consideration by young families since it allows the purchase of extra life insurance without having to take a physical examination. Paid-up additions generate dividends and cash values that in turn will generate additional dividends and cash values.

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