What is a key difference between universal life insurance and whole life insurance?

The correct choice highlights one of the most significant features that distinguishes universal life insurance from whole life insurance. Universal life insurance is designed to offer flexibility in both premiums and death benefits. Policyholders can adjust the amount and frequency of their premium payments, as well as the coverage amount within certain limits, allowing for a more tailored insurance solution that can adapt to changing financial circumstances.

In contrast, whole life insurance typically comes with fixed premium payments and a guaranteed death benefit, making it a more straightforward and predictable form of insurance. The rigidity of whole life policies can sometimes be less appealing to individuals who prefer the adaptability that universal life provides.

Understanding this difference is essential for consumers and agents alike, as it influences decisions based on personal financial strategies and needs.