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. Attained Age

    1) The age at which the beneficiary of an insurance policy, retirement ...
  2. Dependency Ratio

    A measure showing the number of dependents (aged 0-14 and over ...
  3. Yearly Renewable Term - YRT

    A one-year term life insurance policy. This type of policy gives ...
  4. Expense Constant

    A fixed amount added to a policy to cover the cost of administering ...
  5. Term Life Insurance

    A policy with a set duration limit on the coverage period. Once ...
  6. Normal Retirement Age - NRA

    The age at which people can receive full benefits upon leaving ...
Related Articles
  1. Insurance

    What Is the Best Age to Get Life Insurance?

    Learn about the optimal time for purchasing personal life insurance and why delaying the buying decision may have costly consequences.
  2. Financial Advisor

    Why to Buy Term Life Insurance with a Conversion Option

    Why you should always purchase a term life insurance policy that allows for an unrestricted conversion option.
  3. 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.
  4. Financial Advisor

    Understanding Life Insurance Premiums

    When buying permanent life insurance, what amount of premium should you pay for the coverage?
  5. Insurance

    Long-Term Care Insurance: Who Needs It?

    No one is immune to the possibility of one day needing long-term care - and the costs can deplete a life savings.
  6. Insurance

    5 Mistakes That Can Ruin Your Life (Insurance)

    Don't let these simple errors leave you unprotected. Read on to learn more.
  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. 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?
  9. Retirement

    How Survivorship Life Insurance Works

    Should you buy a survivorship life insurance policy?
  10. 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.
RELATED FAQS
  1. When am I eligible to receive Social Security benefits?

    Understand when you are eligible to begin collecting Social Security retirement benefits and how retiring at different ages ... Read Answer >>
  2. Why is my insurance premium so high/low?

    Insurance premiums can be affected by many factors including: type and amount of risk size of deductible amount of coverage ... Read Answer >>
Hot Definitions
  1. Federal Direct Loan Program

    A program that provides low-interest loans to postsecondary students and their parents. The William D. Ford Federal Direct ...
  2. Cash Flow

    The net amount of cash and cash-equivalents moving into and out of a business. Positive cash flow indicates that a company's ...
  3. PLUS Loan

    A low-cost student loan offered to parents of students currently enrolled in post-secondary education. With a PLUS Loan, ...
  4. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  5. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  6. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
Trading Center