Which of the following best describes how cash value can be utilized in a VUL policy?

The correct answer highlights the flexibility inherent in Variable Universal Life (VUL) policies concerning their cash value. Within a VUL policy, the cash value component grows over time, and policyholders have the option to access this cash value in various ways. Specifically, they can borrow against the cash value, which means they can take a loan from the insurance company using the cash value as collateral. This can provide liquidity to the policyholder for various financial needs.

Additionally, policyholders can withdraw funds directly from the cash value as needed. This accessibility is a key selling point of VUL policies, enabling individuals to use the cash value for emergencies, investments, or other expenses without necessarily surrendering the policy. The ability to both borrow against and withdraw cash value allows policyholders to manage their financial circumstances strategically.

This contrasts with other options where limitations or conditions are placed on the cash value, reducing the inherent flexibility that a VUL policy typically provides.