Adjustable Life Insurance
Definition of 'Adjustable Life Insurance'
A type of life insurance that combines features of term and whole life coverage, giving holders the option to change the characteristics of their policies as their needs change over time. Adjustable life insurance policies allow holders to manipulate the period of protection, increase or decrease the face amount, raise or lower the premium amount, and change the length of the premium payment period. These policies also incorporate an interest bearing side fund (cash value).
Adjustable life insurance is also known as "flexible premium adjustable life insurance".
Investopedia explains 'Adjustable Life Insurance'
Adjustable life insurance differ from other life insurance products because there is no requirement to cancel or purchase additional policies as holders' circumstances change.
Adjustable life insurance policies are best suited for individuals who want the protection and cash value benefits of whole life insurance along with an increased measure of flexibility. With the ability to modify payments, coverages and terms, holders can customize their coverage as their incomes and family responsiblities grow and change through the years.