What does Automatic Cost of Living Adjustment mean? Read on to discover the definition & meaning of the term Automatic Cost of Living Adjustment - to help you better understand the language used in insurance policies.
Automatic Cost of Living Adjustment
Automatic cost of living adjustments (COLA) pertain to automatic changes in salaries in correspondence with a change in inflation. In the context of insurance, automatic COLA is a disability insurance rider that allows for an increase of the benefits paid out to a disabled person in response to a decrease in the purchasing power of money over time.
We hope the you have a better understanding of the meaning of Automatic Cost of Living Adjustment.