What type of life policy offers investments in products like money market funds and stocks?

Variable life insurance is a type of policy that allows the policyholder to allocate a portion of their premium payments to various investment options, such as stocks, bonds, and money market funds. This investment component distinguishes variable life from other types of life insurance policies, which typically have a fixed cash value or return.

In variable life insurance, the cash value and death benefit can fluctuate based on the performance of the chosen investments. This means that while there is the potential for higher returns, there is also an associated risk, as the cash value can decrease if the investments perform poorly. Consequently, policyholders have more control over their investment choices and can potentially achieve growth in line with market performance.

Other life insurance options, such as whole life and term life policies, do not involve direct investment in the stock market or similar products. Whole life insurance offers guaranteed cash value growth and a set premium, while term life insurance provides coverage for a specified period but does not accumulate cash value or involve investments. Universal life insurance combines flexible premiums with a cash value component, but its investments are generally more conservative compared to variable life insurance. Thus, variable life stands out for its investment capability, making it suitable for those interested in actively managing their policy's growth potential.