What is another name for universal life insurance?

Universal life insurance is often referred to as interest-sensitive whole life insurance because it combines life insurance protection with a cash value component that can grow based on interest rates. The policyholder has the flexibility to adjust premium payments and death benefits, which is a defining feature of universal life. This type of insurance allows for both flexibility in payments and a potential for cash value growth, all of which are sensitive to changes in interest rates.

The term "interest-sensitive" specifically highlights how the cash value accumulation can fluctuate with prevailing interest rates, unlike other life insurance products that have fixed structures. This distinguishes universal life from more traditional life insurance products, which typically have more rigid premium and benefit structures.

Understanding the flexibility and interest sensitivity of universal life insurance can be crucial for policyholders looking for both coverage and the ability to adapt to changing financial circumstances.