Cash Value Life Insurance: Protection and Growth in One Strategy

Life insurance is often thought of only as protection.

But certain types of policies also build something called cash value.

Cash value is a portion of the policy that grows over time.

Unlike term insurance, which provides coverage for a specific period, permanent life insurance policies may accumulate cash value throughout the life of the policy.

Example

If someone contributes $10,000 per year into a policy designed to accumulate cash value, a portion may go toward insurance costs while the remainder builds value inside the policy.

Over time, that value may grow to:

• $50,000

• $100,000

• $200,000 or more depending on structure and time.

The cash value may be accessed later for:

• Retirement income

• Emergency funds

• Large purchases

At the same time, the policy continues providing a death benefit for family protection.

This dual purpose is why many people view cash value life insurance as both a protection and financial planning tool.

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— Sahil Virani