Who regulates variable life insurance policies?

A variable life insurance policy is a type of whole life policy. The primary difference is that the policyholder can designate an investment vehicle, often a mutual fund, into which to invest. Therefore, the portion of the premium that accumulates as cash value does so within the mutual fund, rather than within the insurance policy. That said, since the product is fundamentally an insurance policy, the state department of insurance is the primary regulator. To the extent that a security is involved (the mutual fund), there may be co-regulation by the state entity that regulates securities, or by the Securities and Exchange Commission which is a federal body.

A variable life insurance policy, or any other insurance policy, should be viewed as insurance and not as an investment. There may be some financial flexibility afforded by a product such as this, but it is fundamentally death protection.