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In other words, these clients would like to have their proverbial cake and eat it too, and Equity Indexed Universal Life policies appear to accommodate that desire quite nicely. Such policies are suitable for clients who don't have risk tolerance for the volatility of a pure equity Variable Univeral Life policy, but also don't want to miss some of the "play" of rising equities in general. This new policy, called Equity Indexed Universal Life, has a crediting rate associated with equity indexes of the broad markets plus mechanisms to moderate losses when equities are otherwise falling. As equity market volatility began to become a fact of life in the 1990s, several life insurers developed a Universal Life hybrid. As with the one-life Variable Universal Life, the policy owner allocates the premium into subaccounts. As with Universal Life, Variable Universal Life policies are typically illustrated on a current assumption basis, with policy values projected using a stipulated premium payment under guaranteed insurance charges/zero percent average return and a current assumption of current insurance charges and a client-selected, average investment rate of return projection not to exceed 12 percent. Unless accompanied by a high premium requirement, there are no investment account guarantees, but there will always be a schedule of maximum insurance charges in the policy.

Typically the offerings include a number of fixed return accounts, bond accounts, and equity accounts, including small cap, large cap, and international funds. Variable Universal Life is a variation on Universal Life that requires the policy owner to invest the premiums into one or more of the offered subaccounts, which are very similar to mutual fund accounts. As Universal Life policies became popular in the early 1980s (with as much as a 40 percent market share of new, permanent life sales), several auto insurance companies produced yet another variation on flexible premium policies with the introduction of so-called Adjustable Life policies. Survivorship versions are also sold. While it would seem that such policies should have become more popular, their features and constructs are sophisticated and take more time and training than many insurance agents are willing to invest.