What type of life policy combines investment choices with a form of term coverage?

The correct choice represents a type of life insurance policy that merges elements of both investment and insurance coverage. Variable Universal Life (VUL) insurance allows policyholders to invest a portion of their premiums into various investment options, such as stocks, bonds, or mutual funds, while also providing a flexible death benefit and premium payment options.

This policy structure provides policyholders the autonomy to adjust their investment choices based on their financial goals and risk tolerance. Additionally, the term coverage aspect of this policy means that it can initially provide a death benefit that is often aligned with term life insurance but with the added advantages of cash value accumulation and potential for growth through investments.

In contrast, pure term life insurance does not offer any investment component and strictly provides death benefit coverage. Whole life and universal life policies do include cash value components as well but do not offer the same level of investment choice and risk potential that VUL policies do, making the latter distinct in its combination of investment flexibility and insurance protection.