Universal Life policies are one type of permanent policy available, whole and variable being the other two.  I do not believe in variable products as a rule (if you're going to get life insurance then why are you leaving it up to chance whether you'll have one in the future) and whole life policies are described in the next section.

Universal life policies have two components: an insurance component and an investment component.  Every dollar that is put into a policy gets divided between the two components.  The investment portion can be either the stock market, bond market, or a combination of the two. The portion of the dollar that goes into the investment side is determined by the health rating that you get.  That, in turn, is determined by your age, sex, and health.

Permanent policies can be used for several purposes.  A popular one is estate planning.  If your estate as a couple exceeds $10.5 million, you will have to pay 40% in taxes.  By buying a second-to-die policy (which pays off after both spouses pass,) you can make sure that your children are not faced with that heavy tax burden.

Another use of permanent policies is college planning.  The policy can be overfunded, and the cash value portion can be used for college expenses.  Since the policy is in the parent's name, it will not affect the child from receiving student loans.