Indexed Life Insurance
Policy with a face value that varies according to a prescribed index of prices; otherwise benefits provided are similar to ordinary whole life. The death benefit is based on the particular index used, such as the Consumer Price Index (CPI). The policy owner has the choice of having the index applied either automatically or on an elective basis. With an automatic index increase, the premium remains level since it has already been loaded to reflect the automatic increase. If the policy allows for an optional index increase, an extra premium is charged when this option is exercised by the policy owner. Regardless of which index is selected automatic or optional the increased death benefit does not require another physical examination or other evidence of insurability.
Popular Insurance Terms
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Measure of policyholder interest in a variable annuity policy prior to the annuity date. This measure is similar to a unit in a mutual fund. ...
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Figure in a mortality table derived by dividing the number of people alive at the end of a given year by the number of people alive at the beginning of that same year. ...
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Payment of premiums and benefits as they come due. In pension plans, known as the "pay as you go basis." The plan depends on new employees coming into the work force so that their ...
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