DEFINITION of 'Issue Age Policy'

An insurance policy whose rate is dependent on the age of the individual who purchases it. An issue age policy is more expensive for an older individual than a younger one, but once purchased does not increase in price any further. Premium payments typically increase as the cost of healthcare services rises as a result of inflation.

BREAKING DOWN 'Issue Age Policy'

Insurance companies tie the cost of an issue age policy to an individual's age because older policy holders are more likely to require treatment. Compared to attained age policies, issue age policies are typically less expensive in the long term. Attained age policies become more expensive as the policy holder grows older.

RELATED TERMS
  1. Normal Retirement Age - NRA

    The age at which people can receive full benefits upon leaving ...
  2. Term Life Insurance

    A policy with a set duration limit on the coverage period instead ...
  3. Expense Constant

    A fixed amount added to a policy to cover the cost of administering ...
  4. Cover Note

    A temporary document issued by an insurance company that provides ...
  5. Aging Schedule

    An accounting table that shows the relationship between a company’s ...
  6. Adjustable Life Insurance

    A type of life insurance that combines features of term and whole ...
Related Articles
  1. Insurance

    4 Reasons Why Waiting To Buy Life Insurance Is a Bad Idea

    Understand the benefits of applying for and securing life insurance coverage while you are young and healthy, and learn the cost of waiting to get coverage.
  2. Financial Advisor

    10 Best Companies for Obtaining Life Insurance Over 50 (MET, PRU)

    For individuals over age 50 with differing needs, the best life insurance companies include large financial services companies and smaller mutual entities.
  3. Retirement

    Stretching Retirement Plans for Clients Who Live to 115

    What are the financial implications of living until age 115—and how do they impact your retirement planning?
  4. Investing

    Do Financial Decisions Get Better With Age?

    Like a fine wine, you no doubt get better as you get older, but your money choices might not.
  5. Financial Advisor

    Understanding Life Insurance Premiums

    When buying permanent life insurance, what amount of premium should you pay for the coverage?
  6. Small Business

    How to Find a Job After Age 50

    Finding a job at any age can be tough but older candidates face specific challenges. Thankfully there are ways to stack the odds in your favor.
  7. Financial Advisor

    Advising FAs: Explaining Life Insurance to a Client

    Life insurance was initially designed to protect the income of families, particularly young families in the wealth accumulation phase, in the event of the head of household's death.
  8. Retirement

    Baby Boomer Economics: 5 Facts to Help You Plan Your Retirement

    A look ahead at what you can expect to spend when you retire.
  9. Insurance

    How to Choose Permanent Life Insurance Policies

    When does it makes sense to buy a guaranteed rather than a non-guaranteed life insurance policy?
Hot Definitions
  1. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
  2. Racketeering

    A fraudulent service built to serve a problem that wouldn't otherwise exist without the influence of the enterprise offering ...
  3. Aggregate Demand

    The total amount of goods and services demanded in the economy at a given overall price level and in a given time period.
  4. Fixed Cost

    A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses ...
  5. Blue Chip

    A blue chip is a nationally recognized, well-established, and financially sound company.
  6. Payback Period

    The length of time required to recover the cost of an investment. The payback period of a given investment or project is ...
Trading Center