Extended increasing interest rate environment

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Reference no: EM131047611

Background: A Universal life (UL) insurance traditionally uses what is referred to as a portfolio rate when paying interest to a policyholder. Reference (see below)

Question: When using a portfolio rate, what would cause the portfolio interest rate on a UL to perform better than the market in an extended declining interest rate market and yet would perform worse than the market in an extended increasing interest rate environment?

Reference no: EM131047611

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