John Camey has a life insurance policy that is tied to a separate stock fund.The cash value of his insurance policy depends on the value of this fund.He is guaranteed a minimum death benefit but the death benefit can be higher,depending on the value of the fund.What type of life insurance does John likely have?

Question

Quizplus · Accepted Answer

Variable life insurance policies are tied to separate accounts that invest in stocks, bonds, or money market funds. The cash value of the policy depends on the value of the investments in the separate account. The policyholder may be able to choose how the cash value is invested, and the death benefit may vary depending on the performance of the investments. This type of policy is suited for those who are comfortable with investment risk and want the potential for higher returns.

John Camey Has a Life Insurance Policy That Is Tied