Final answer:
The statement is false; universal life policies combine term insurance with an investment savings element and offer flexibility in premiums and death benefits, not just annually renewable term insurance.
Step-by-step explanation:
The statement that the insurance component of a universal life policy is always annually renewable term insurance is false. A universal life policy is a flexible premium, adjustable life insurance product that combines elements of term insurance with an investment savings element.
While the cost of insurance within a universal life policy is typically based on annually renewable term rates, the unique aspect of universal life insurance is the flexibility it offers in terms of premiums and death benefits. Policyholders can adjust the death benefit and the premium payments to suit their needs, subject to certain conditions and limits.