variable life insurance
Also found in: Acronyms.
Variable Life Insurance
A whole life insurance policy in which some, or all, of the premium is allocated to a separate account, which is invested in common stock. If the common stock portfolio does well, the death benefit increases accordingly; if it performs poorly it decreases, though all variable life insurance policies have a benefit floor. A significant advantage to a variable life insurance policy is the fact that the policyholder does not have to pay taxes on earnings from the portfolio until it is cashed in, usually through death. In the United States, variable life insurance policies are considered securities contracts and, as such, they are regulated by federal law.
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variable life insurance
Life insurance that relates benefits to the value of a separate investment account underlying the annuity. This insurance is designed to prevent erosion of benefits by inflation. The size of the benefits will vary.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
Variable life insurance.
Variable life insurance policies are cash-value policies that allow you to choose how your premium is invested from among a package of alternatives offered by the insurer.
In many variable life policies, the face value of your policy depends on how well the investments you've chosen are performing.
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