Fixed universal life typically has the lowest risk. Variable universal is more likely because it has a cash value that is tied to stocks or bonds. However, guaranteed universal life has the lowest risk while variable universal life and index universal life have more potential to build cash value.
One exception is if you were to borrow against your cash value. The loan amount isn't taxable if you pay back the total amount while your policy is still active. Your policy might lapse if the amount you borrow (including interest) exceeds the cash value.
There is an exception if you are borrowing against your cash value. If you pay back the entire amount while your policy continues to be active, the loan amount is not taxable. If the cash value exceeds the amount that you borrowed (including interest), your policy might be terminated.
A UL insurance policy can have many options beyond whole life and term coverage. A policy should be managed. It must be decided how much you want for premiums. If you have variable UL you also need to make investment choices. These variables, and rising insurance costs over time, can impact your cash value. Keep an eye on your cash value over time. If it is lower than zero, your premiums could rise or your policy may be cancelled.
UL allows you to adjust your payments according to certain limits. Although you might eventually need to pay more premiums to maintain your coverage, this flexibility can help keep your policy in place if your earnings change.
Guaranteed universal life is the best option. Variable universal life, on the other hand, has the highest risk. The cash value tied to bonds and stocks means that variable universal life comes with the most excellent chance. You can build more cash value by having indexed universal and variable life rather than guaranteed universal.