Which characteristic is true about the default investment options in Variable Life Insurance?

In Variable Life Insurance, the default investment options are typically predetermined by the insurance company. This means that when a policyholder initially purchases the policy, the company establishes a set of investment options, which may include various managed funds or portfolios, into which policyholder premiums can be allocated if no specific choice is made.

These predetermined options are designed to align with the overall investment strategy and risk profile the insurer has established for the product. The policyholder does have the ability to later adjust their investment allocations among different options available, but unless an active choice is made, the default options set by the insurance company apply. This framework helps provide structure and consistency in managing the investments associated with the policy, while still allowing the policyholder flexibility to customize their investment approach over time.

The other options do not accurately reflect how default investment options work in Variable Life Insurance. They may imply a level of engagement or guarantee that does not apply to the nature of these predetermined selections by the insurer.