Annual Crediting Cap
Definition
- An annual (yearly) limit on what can be credited to an equity-indexed annuity.
Synonyms
credit cap, yearly crediting cap
Related Terms and Acronyms
- Annuity Table — Definition,
- A table that can be used to find the future value of an annuity.
- Cap — Definition,
- A limit imposed on an item.
- The top limit on the amount the interest rate can increase during a single time period of an adjustable-rate mortgage. Every ARM has two caps: a periodic cap, which limits the periodic changes to the interest allowed in the loan agreement, and a lifetime cap, which governs the total increase that can be imposed during the life of the loan.
- Indexed Annuity — Definition,
- An annuity where investment performance is pegged to a stock index.
- Interest Rate Cap — Definition,
- A limit to the interest rate increases and decreases on an adjustable rate loan; either from one adjustment period to the next or over the life of the loan.
- Participation Rate — Definition,
- The rate at which changes in a stock index affect the profit credited to an annuity.
