What Are Some Characteristics Of Whole Life Insurance? 
This is a great question and I appreciate the opportunity to offer some answers ! Whole Life Insurance has a lot of benefits ! For one it is highly customizable in the way it may be funded . It can be set up to be funded in as little as 11 annual payments , or paid for monthly over the life of the insured up to age 100 . Whole Life policies have a Guaranteed cash accumulation feature where a guaranteed interest is paid into a cash value portion of the policy , which then becomes a liquid asset accessible at the will of the owner of the policy . The interest -LRB- as well as dividends in participating policies -RRB- is paid into the cash value Tax-FREE . And a policy may be `` over-funded '' up to about 300 % , which of course will increase the tax-free interest growth rate . In a participating policy where dividends are paid in , the dividends may be used to purchase additional insurance . This increases not only the death benefit without ever taking another medical exam or even answering questions , but also increases the dividends paid ! Whole life insurance does not expire . It remains in force -LRB- as long as the premiums are paid up -RRB- until the insured dies , the owner decides to surrender the policy -LRB- for the cash value -RRB- , or the insured reaches the age of endowment . The age of endowment varies with the policy , but may be age 95 , 99 , 100 , or now days may be as high as age 121 . When that happens the entire value of the policy is handed over to the owner of the policy . Income tax free . When paid , the death benefit passes to the beneficiary -LRB- ies -RRB- income tax free . Another option available with Whole Life Insurance is the ability to use the cash value and then to take loans from the policy death benefit to supplement retirement income ! This can be set up to be paid out monthly , quarterly or annually ... and these payments are , again , Tax-free ! So to sum up , Whole Life Insurance does not expire regardless of the possible declining health of the insured and provides a death benefit to beneficiaries that is transferred tax-free . Whole Life grows Cash Value , Tax-Free , which is a liquid asset that may be used for any purpose the owner wishes , and may be accessed without incurring a taxable event by means of a policy loan . With participating policies the cash value can increase by means of guaranteed interest and dividends , which may be used to buy additional insurance with no medical requirements . The premiums are set at the beginning of the policy and are guaranteed not to increase for any reason . And the entire premium may be paid in as little as 11 annual payments , spread out over the lifetime of the insured , or set up to be paid over a 15 , 20 or 30 year period determined by the the owner of the policy . And Whole Life Insurance may be used to supplement retirement income as a tax-free cash stream . 