Universal life
A whole life insurance product whose investment component pays a competitive interest rate rather than the below-market crediting rate. |
Similar financial terms
Weighted average lifeFor amortizing securities, investors do not talk in terms of a bond’s maturity since its principal is made over time. This is because the stated maturity of such securities only identifies when the final principal payment will be made.
Half-life
The point in the life of a mortgage-backed security guaranteed or issued by the Government National Mortgage Association, the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, when half the principal has been repaid
Whole life insurance
A contract with both insurance and investment components: (a) It pays off a stated amount upon the death of the insured, and (b) it accumulates a cash value that the policyholder can redeem or borrow against.
Variable life insurance policy
A whole life insurance policy that provides a death benefit dependent on the insured's portfolio market value at the time of death. Typically the company invests premiums in common stocks, and hence variable life policies are referred to as equity-linked policies.
Term life insurance
A contract that provides a death benefit but no cash build-up or investment component. The premium remains constant only for a specified term of years, and the policy is usually renewable at the end of each term.
