Whole life insurance, also known as permanent life insurance, is a type of life insurance that provides coverage for the entire lifetime of the insured person. Unlike term life insurance, which provides coverage for a specific period of time, whole life insurance does not expire as long as the premiums are paid. Whole life insurance policies typically have higher premiums than term life insurance policies, but they also build cash value over time. This cash value can be borrowed against or used to pay premiums, if necessary.
Additionally, Whole life insurance policies also have a guaranteed death benefit, which is the amount of money that will be paid to the beneficiaries when the insured person dies. Some whole life insurance policies also provide dividends, which are a return on the insurance company’s investment performance.
