What does whole life insurance provide in addition to death benefits?

Whole life insurance provides not only a death benefit to beneficiaries but also features a cash value accumulation component. This cash value grows over time at a guaranteed rate as long as the policy premiums are paid. The cash value can be borrowed against or withdrawn under certain conditions, providing the policyholder with access to funds during their lifetime.

The nature of whole life insurance allows individuals to build a financial asset within their policy, which can serve as an additional source of funds for emergencies, investments, or retirement planning. This dual purpose—providing a death benefit while accumulating cash value—distinguishes whole life insurance from term life insurance, which solely provides coverage for a specific term without any cash value component.