Whole Life Insurance Policy

AAA

DEFINITION of 'Whole Life Insurance Policy'

A life insurance contract with level premiums that has both an insurance and an investment component. The insurance component pays a stated amount upon death of the insured. The investment component accumulates a cash value that the policyholder can withdraw or borrow against.

INVESTOPEDIA EXPLAINS 'Whole Life Insurance Policy'

As the most basic form of cash-value life insurance, whole life insurance is a way to accumulate wealth as regular premiums pay insurance costs and contribute to equity growth in a savings account where dividends or interest is allowed to build-up tax-deferred.

VIDEO

RELATED TERMS
  1. Accumulation Option

    A policy feature of permanent life insurance that allows policyholders ...
  2. Single-Premium Life Insurance

    An insurance plan in which a lump sum of cash is paid up front ...
  3. Equity-Indexed Universal Life Insurance

    A permanent life insurance policy that allows policyholders to ...
  4. Group Carve-Out Plan

    A type of group term life insurance designed to appeal to well-paid ...
  5. Adjustable Life Insurance

    A type of life insurance that combines features of term and whole ...
  6. Cash Surrender Value

    The sum of money an insurance company will pay to the policyholder ...
Related Articles
  1. Top 10 Life Insurance Myths
    Insurance

    Top 10 Life Insurance Myths

  2. Protect Your Kids And Pets With Custom ...
    Insurance

    Protect Your Kids And Pets With Custom ...

  3. Cashing In Your Life Insurance Policy
    Options & Futures

    Cashing In Your Life Insurance Policy

  4. Variable Vs. Variable Universal Life ...
    Retirement

    Variable Vs. Variable Universal Life ...

Hot Definitions
  1. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  2. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  3. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  4. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  5. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  6. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
Trading Center