What Is Whole Life Insurance? Definition

Why it matters

Whole life costs more than term for the same death benefit, because the policy is built to last and to build cash value. Premiums are typically level, meaning they stay the same. Some carriers pay dividends, but these are not guaranteed. Families use whole life for final expenses, estate needs, or lifelong dependents. Agents explain the trade-off clearly: higher cost, lasting protection. Policy guarantees, loan terms, and dividend history differ by carrier, so compare each one before buying.

Source: iii.org

Where we use this term

Which carriers can Epic Life agents sell for?

Related terms

Term Life Insurance: Term life insurance is coverage that lasts for a fixed period, such as 10, 20, or 30 years. It pays a death benefit only if the insured dies during that term. It usually builds no cash value.
Cash Value: Cash value is the savings part of a permanent life insurance policy. It grows over time at a rate set by the policy and can be borrowed against or withdrawn, subject to the contract terms.
Participating Policy: A participating policy is a life insurance policy that may pay dividends to the owner. Whole life from mutual carriers is the common example, and the dividends are not guaranteed.
Dividend: A dividend in life insurance is a share of a carrier's surplus paid to owners of participating policies. It is not guaranteed and can change each year based on the carrier's results.
Level Premium: A level premium is a payment that stays the same for the life of the policy or for a set period, such as a 20-year term. It does not rise as the insured gets older.

All 241 terms

Why it matters

Where we use this term

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