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Coacervation of charged polymer chains has been a topic of major interest both in polymer and biological sciences, as it is a subset of a phenomenon called liquid-liquid (LLPS) phase separation. In this process a polymer-rich phase separates from the polymer-lean supernatant while still maintaining its liquid-like properties. LLPS has been shown to play a crucial role in cellular homeostasis by driving the formation of membraneless organelles. It also has the potential to be harnessed to aid in novel therapeutical applications. Recent studies have demonstrated that there is no one simple mechanism which drives LLPS, which is instead a result of the combined effect of electrostatic, dipolar, hydrophobic, and other weak interactions. Using coarse-grained polymer simulations we investigate the relatively unexplored effects of monomer polarizability and spatially varying dielectric constant on LLPS propensity, and these factors affect the properties of the resulting condensates. In order to produce spatial variations in the dielectric constant, all our simulations include explicit solvent and counterions. We demonstrate that polarizability has only a minor effect on the bulk behaviour of the condensates but plays a major role when ion partitioning and microstructure are considered. We observe that the major contribution comes from the nature of the neutral blocks as endowing them with an induced dipole changes their character from hydrophobic to hydrophilic. We hypothesize that the results of this work can aid in guiding future studies concerned with LLPS by providing a general framework and by highlighting important factors which influence LLPS.