Page 19 - Life Assurance

ommonly, if the owner of the policy is covered
for L.E 5,000, the spouse and the children will have
L.E 1,000 each. The L.E 5,000 portion of the
contract may be term or permanent insurance, but
coverage on the spouse and the children is usually
convertible term insurance. One premium is charged
for the entire package that solves a common need,
that of a limited amount of protection for the
breadwinner's dependents, combined with insurance
on the family head.

5/2/9 Variable Life Contract:

Life insurance designed to help the amount
of protection meet the loss in purchasing power
caused by inflation has recently been introduced
in the United States, although its use is not yet
widespread. The policy has been available in the
Netherlands for several years. The reserves of
the variable life contract are invested in common
stocks and other equity-type investments that
fluctuate in value according to price changes in
the stock market. Increases in the value of these
investments are reflected in increased policy
face amounts according to a formula stated in
the contract. If the stock market declines, the face
amount also declines, but some contracts contain a
minimum death benefit equal to the original face
amount.

119 Life51/life/life 08