What type of life insurance incorporates flexible premiums and an adjustable death benefit?

The correct answer is universal life insurance, which is specifically designed to offer policyholders flexibility in terms of premium payments and the death benefit amount. With universal life insurance, individuals can adjust their premiums within certain limits, allowing them to pay more or less based on their current financial situation. Additionally, the death benefit can be increased or decreased, based on the policyholder's needs and preferences if the policy's cash value supports such changes.

This flexibility makes universal life insurance distinct from term and whole life insurance. Term life insurance typically provides a fixed premium and a level death benefit for a specified period, without any investment component or cash value. Whole life insurance, on the other hand, has fixed premiums and a guaranteed death benefit, and it accumulates cash value at a predetermined rate, providing less adaptability in premium amounts and death benefits compared to universal policies. Variable life insurance, while it offers investment options that can affect both cash value and death benefit, does not provide the same level of guaranteed flexibility in premium payments as universal life does.