What is the primary feature of a universal life insurance policy?

A universal life insurance policy is characterized primarily by its flexibility. This flexibility allows policyholders to adjust their premium payments and death benefit amounts based on their changing financial situations. Unlike whole life policies, which require fixed premium payments and provide guaranteed cash value growth, universal life enables individuals to pay more or less each month, provided they meet certain minimums. Additionally, policyholders can access the cash value if needed or even increase or decrease their death benefit, subject to certain conditions.

This feature makes universal life insurance particularly appealing for those who may experience fluctuating incomes or have varying insurance needs over time. The ability to modify both the premium payments and the death benefit ensures that the policy remains relevant to the policyholder's current circumstances. Therefore, the correct answer emphasizes the key aspect of flexibility that distinguishes universal life insurance from other types of policies.