What distinguishes Variable Life Insurance from Whole Life Insurance?

Variable Life Insurance, in contrast to Whole Life Insurance, is characterized by its flexibility in terms of premiums and death benefits. This means that policyholders have the ability to adjust their premium payments and the death benefit amounts based on their financial situations and preferences. This feature provides an advantage for individuals looking for more control over their insurance coverage and financial planning.

Additionally, while both types of insurance can build cash value, Variable Life Insurance allows that cash value to be invested in various sub-accounts, which can lead to potential growth (and also risk of loss) based on the performance of those investments. However, Whole Life Insurance typically offers a guaranteed cash value growth at a fixed rate, with premiums being stable over time.

The fixed premiums are indeed a key feature of Whole Life Insurance, ensuring that the policyholder pays the same amount throughout the life of the policy. This predictability contrasts with Variable Life Insurance, where premiums can be adjusted, creating more variability in the cash value and death benefit.

Overall, the distinguishing factor for Variable Life Insurance is its allowance for changes to premiums and death benefits, aligning with the financial goals of the policyholder more closely than the rigid structure of Whole Life Insurance.