How does cash value life insurance work?
Cash value life insurance is a policy that contains an account that builds value (“cash value”) over time. It works by taking a part of your premium payment and putting it into to the account.
Depending on the policy type, the cash value can make investment gains based on a fixed percentage increase, on stock market gains or another method. You can take withdrawals or loans from the cash value. You can use the money for anything, such as:
- Unexpected bills.
- A child’s college tuition.
- To supplement retirement income
