Which of the following describes variable life insurance?

Variable life insurance is accurately described as a form of permanent life insurance that includes varied cash value investments. This type of policy allows policyholders to allocate their cash value among a range of investment options, typically including stocks, bonds, and mutual funds. As a result, the cash value of the policy can fluctuate based on the performance of those investments, providing the potential for growth beyond what is offered in traditional whole life insurance products.

Variable life insurance also features a death benefit that can vary, depending largely on the performance of the chosen investments. This characteristic distinguishes it from other types of life insurance that provide fixed benefits. Because of its investment component, the policyholder assumes more risk but also holds the potential for greater rewards based on investment performance.

This design makes it a versatile option for policyholders looking for both life insurance coverage and the opportunity to invest their cash value.