What is typically a characteristic of whole life insurance?

Whole life insurance is designed to provide coverage for the entire lifetime of the insured, as long as premiums are paid. A key characteristic of whole life insurance is that it accumulates cash value over time. This cash value grows at a guaranteed rate, allowing policyholders to build savings that they can borrow against or withdraw, providing added financial flexibility.

The cash value component distinguishes whole life insurance from term life insurance, which does not build cash value and covers the insured only for a specified period. Therefore, the ability of whole life insurance to accumulate cash value is not just a defining feature, but also adds to its long-term benefits for policyholders.