Final answer:
An equity-indexed life policy is a form of insurance on investments that ties the cash value growth to the performance of a stock market index.
Step-by-step explanation:
An equity-indexed life policy is a form of insurance on investments. It is a type of life insurance policy that ties the cash value growth to the performance of a specific stock market index, such as the S&P 500. This means that the returns on the policy will be based on how well the index performs. For example, if the index increases, the policy's value will also increase.
Equity-indexed life policies are often considered a conservative investment option due to their potential for higher returns compared to traditional fixed-rate policies, while also providing some protection against market downturns. However, it's important to carefully consider the terms and fees associated with these policies, as they can vary.