Which type of life policy incorporates flexible premiums and an adjustable death benefit?

• A. Universal life
• B. Whole life
• C. Term life
• D. Variable life

Answer: (A)

Flexible premiums and an adjustable death benefit describe universal life. This policy type lets you vary premium payments and even skip payments as long as the cash value covers the policy charges. The cash value earns interest and can be used to fund a death benefit that you can increase or decrease over time. This contrasts with whole life, which has fixed premiums and a guaranteed, typically fixed death benefit; term life, which provides a death benefit for a set term without cash value; and variable life, which ties cash value to investment performance and usually involves fixed premium patterns rather than flexible ones.