What feature of Variable Universal Life allows for flexibility in payments?

The ability to skip payments, provided the cash value is sufficient, is a key feature of Variable Universal Life (VUL) policies that offers significant flexibility for policyholders. In a VUL policy, the premiums are flexible compared to traditional whole life or term life policies where payments are typically rigid and must be made on a strict schedule.

When a policy has accumulated enough cash value, the owner can use that cash value to cover the premium payments, allowing them to skip making out-of-pocket payments without jeopardizing the policy's status. This feature is particularly beneficial during financial hardships or unexpected expenses when maintaining the insurance coverage is still a priority but coming up with cash for premiums may be difficult.

The other options do not allow for this type of payment flexibility. Annual payments lack the essential flexibility inherent to VUL policies. Fixed premiums prevent the adaptation to changing financial situations. Mandatory premium increases do not facilitate flexibility either, as they require the policyholder to pay more regardless of their circumstances.