What does Participation Rate mean? Read on to discover the definition & meaning of the term Participation Rate - to help you better understand the language used in insurance policies.
A participation rate is the percentage that a policyholder will receive on an equity-indexed annuity. Many life insurance companies offer annuities as an investment opportunity. Companies who offer annuities decide on the participation rate for the policyholders. The higher it is, the higher the percentage of earnings the policyholder will receive from the annuity.
We hope the you have a better understanding of the meaning of Participation Rate.