Cash Value

Building a cash value means that your life insurance policy has a value greater than just the death benefit — the face value of the insurance policy — that goes to your beneficiaries when you die. (With term insurance, the value is only the amount of death benefit you sign up for.) So what’s the catch? Why would anyone want term insurance instead of a policy with a value beyond the death benefit? To answer that question, you first need to examine how cashvalue whole life insurance works.