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A life insurance policy with cash value may be considered an investment. With some types of policies, a portion of the premiums are put into a cash savings account, earning interest with potential tax savings.1 Aflac offers whole life insurance with cash value that can offer lifelong coverage. Read on to learn what cash value life insurance is, some types of policies that offer cash value, and ways to access these funds.
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Life insurance with cash value is a type of permanent policy that can build funds over time through a growth component, in addition to providing a death benefit to beneficiaries when you pass away. With some insurers, the cash value of the life insurance policy grows separately in a tax-deferred account.1 Aflac utilizes a different route, so it depends on your preference. You can access the cash value during your lifetime through loans, withdrawals, or by using it to pay premiums, which can offer added flexibility to meet financial needs.
Below are a few types of life insurance policies that have cash value:
Don’t wait until it’s too late. Help cover yourself and your family with coverage from Aflac.
Get StartedOne of the major appeals to a cash value life insurance plan is the ability to access the money while you are living.1 Here are some ways to access the cash value of your life insurance:
Some life insurance plans allow you to tap into the cash value of the account to pay for the premiums.1 This can be particularly helpful if new and unexpected expenses arise in other parts of one’s life. However, this may impact the value of the death benefit over time, so we advise you to consider your options.
Another way to access money from your life insurance policy is by taking out a loan against the cash value of your plan. Outstanding loan amounts may reduce the death benefits in the event of the policyholder’s death before the full repayment of the loan, so we advise you to speak with a financial professional beforehand.1
Some insurance companies will allow you to withdraw money from your policy’s cash value savings account. We recommend you do not take out more money than what you have paid into the account so far because doing so may reduce the death benefit.1
To access the cash value of your plan, you may have to surrender part of your life insurance policy. Depending on the company and plan you choose, you may be able to withdraw money and only surrender part of the plan. However, getting your cash surrender value can also decrease the value of the death benefit.1
Cash value life insurance offers many advantages that can make this type of policy worthwhile, including:
Life insurance with cash value is permanent coverage, meaning it lasts your entire life. You can enjoy peace of mind knowing your loved ones will receive the death benefit, regardless of when you pass away.
With cash value life insurance, you can use the funds from the cash value component while you’re still alive. Once you’ve built up enough cash value, you can enjoy flexible access when needed.
Although cash value life insurance premiums can be higher than term life insurance premiums, the cost for coverage may still fit your budget.
Having a life insurance plan can help protect your loved ones if your main source of income is lost. Additionally, cash value life insurance can give you access to funds when you need them. Aflac whole life insurance for individuals offers cash value and can help provide for your family long-term. You can get this type of plan directly through Aflac. Try our life insurance calculator to see how much life insurance you may need, and chat with an Aflac agent about your options to learn more.
When deciding whether life insurance with cash value is right for you, you should first decide whether you want lifelong coverage. If your goal is to secure a death benefit for your family regardless of when you pass away, then cash value life insurance can be an excellent option. However, if you are only looking for short-term coverage, another policy like term life insurance may be the better choice.
Additionally, it's important to consider whether you want a life policy with a cash value component. If you want to build wealth and have the ability to withdraw or borrow from your policy, then cash value life insurance might be right for you.
No matter what type of life insurance policy you need, it's important to compare quotes and policies before making a decision. This way, you can ensure you're getting the coverage that's best for you and your family.
Get Started
Having a plan in place can help protect your loved ones from the unforeseen difficulties that may arise if a main source of income is lost.
There are many ways that one can start planning, including factoring in life insurance for retirement.
Having a plan in place can help protect your loved ones from the unforeseen difficulties that may arise if a main source of income is lost.
There are many ways that one can start planning, including factoring in life insurance for retirement.
1 Investopedia. What Is Cash Value in Life Insurance? Explanation With Example. Updated September 20, 2024. Accessed February 14, 2025. https://www.investopedia.com/terms/c/cash-value-life-insurance.asp.
2 Investopedia. What Is Universal Life (UL) Insurance? Updated November 26, 2024. Accessed February 14, 2025. https://www.investopedia.com/terms/u/universallife.asp.
3 Investopedia. Variable Life Insurance: Definition, Tax Benefits, Vs. Term Life. Updated August 16, 2023. Accessed February 14, 2025. https://www.investopedia.com/terms/v/variablelifeinsurancepolicy.asp.
4 Investopedia. Indexed Universal Life Insurance/ Pros and Cons. Updated February 12, 2024. Accessed February 14, 2025. https://www.investopedia.com/articles/personal-finance/012416/pros-and-cons-indexed-universal-life-insurance.asp.
Coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, coverage is underwritten by American Family Life Assurance Company of New York.
68000 series: In Arkansas, Idaho, Oklahoma & Virginia, ICC1368100, ICC1368200, ICC1368300, ICC1368400. In Delaware, Policies A68100-A68400. B1000: In Arkansas, Idaho, Oklahoma, Oregon, Pennsylvania, Texas, & Virginia, Policies: ICC18B61JWO & ICC18B61JTO. In Delaware, Policies B61JWO, B61JTO. B60000: In Arkansas, Oklahoma, Pennsylvania, Texas & Virginia, Policies: ICC18B60C10, ICC18B60100, ICC18B60200, ICC18B60300, & ICC18B60400. Q60000: Whole: In Arkansas, Delaware & Oregon, Policy Q60100M. In Idaho Policy Q60100MID. In Oklahoma, Policy Q60100MOK. In Pennsylvania, Policy Q60100MPA. In Texas, Policy Q60100MTX. Term: In Delaware, Policies Q60200M. In Arkansas, Idaho, Oklahoma, Oregon & Texas, Policies ICC18Q60200M.
Aflac Final Expense insurance coverage is underwritten by Tier One Insurance Company, a subsidiary of Aflac Incorporated and is administered by Aetna Life Insurance Company. Tier One Insurance Company is part of the Aflac family of insurers. In California, Tier One Insurance Company does business as Tier One Life Insurance Company (Tier One NAIC 92908). Not available in New York.
In Arkansas, Delaware, Idaho, Oklahoma & Virginia, Policies ICC21-AFLLBL21 and ICC21-AFLRPL21; and Riders ICC21-AFLABR22, ICC21-AFLADB22, and ICC21-AFLCDR22.
Receipt of accelerated death benefits may affect eligibility for public assistance programs. Benefits may also be taxable, and are not expected to receive the same favorable tax treatment as other types of accelerated death benefits that may be available.
Aflac does not offer Universal or Variable Universal life insurance.
Content within this article is provided for general informational purposes and is not provided as tax, legal, health, or financial advice for any person or for any specific situation. Employers, employees, and other individuals should contact their own advisers about their situations. For complete details, including availability and costs of Aflac insurance, please contact your local Aflac agent.
Coverage may not be available in all states including but not limited to DE, ID, NJ, NM, NY, or VA. Benefits/premium rates may vary based on plan selected. Optional riders are available at an additional cost. The policy has limitations and exclusions that may affect benefits payable. Refer to the policy for complete details, limitations, and exclusions. For costs and complete details of the coverage, please contact your local Aflac agent.
Aflac WWHQ | Tier One | 1932 Wynnton Road | Columbus, GA 31999
NY | 22 Corporate Woods Boulevard, Suite 2 | Albany, NY 12211
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