INSURANCE: Hedge Against Inflation

After five years, the Prudential Insurance Co. last week won a major victory in its campaign for variable annuities, a new type of insurance designed to protect policyholders against inflation. Under the plan, annuity payments vary according to the price of common stocks in which premiums are invested, a sharp contrast to conventional annuities, which guarantee fixed payment based on traditional insurance company investments, such as mortgages.

The company, with headquarters in Newark, N.J., won approval by the New Jersey senate of bills, previously okayed by the general assembly, allowing the sale of variable annuities. (Governor Robert B. Meyner...

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