What type of insurance product involves an insured's flexible premium being invested into a separate account?

Variable universal life insurance is designed to offer the policyholder not only life coverage but also the opportunity for cash value accumulation through flexible premiums. In this type of policy, the insured can adjust the premium payments and the death benefit amount, providing a level of versatility that is not typically found in traditional life insurance products.

The separate account feature is crucial; the premiums paid into this policy can be allocated among various investment options, which are often equity, bond, or money market funds. The performance of these investments directly affects the cash value of the policy, providing the potential for greater returns compared to whole life insurance, where the cash value grows at a guaranteed rate. This investment component is key to the policy’s design, as it can lead to increased cash value and potential death benefit increases, aligning with the insured's financial goals and risk tolerance.

In contrast, whole life insurance generally has fixed premiums and guarantees, term life insurance does not accumulate cash value and is purely for providing death benefit protection for a specified period, while fixed annuities focus on providing stable income rather than investment flexibility.