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
Risk incurred by the insurance company after it makes the commitment to make the loan at some future time and the borrower may not accept the loan at that time. ...
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Trade association of commercial insurance brokers whose objective is to further the interests of these brokers through education, lobbying, and adherence to professional ethics. ...
Paid-in surplus, revaluation surplus, and donated surplus. This surplus includes all sources of surplus with the exception of earned surplus. ...
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Risk-creating device as compared with insurance, which is a risk-reducing or -eliminating device. This is a form of speculative risk. ...
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Tables used to determine the present value of a sum in the future by taking into consideration the assumed interest rate and time period involved. ...
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