What is the cash value of whole life insurance often referred to as?

The cash value of whole life insurance is often referred to as a forced savings account. This term effectively captures the idea that as policyholders pay their premiums, a portion of those payments contributes to building a cash value within the policy. This cash value grows over time and can be accessed or borrowed against, providing a financial resource that policyholders can use if needed.

Whole life insurance is designed not only to provide a death benefit but also to accumulate cash value that can be viewed as a form of savings. While the underlying structure ensures that the policy provides a death benefit, the accumulation of cash value represents a savings component that many people might not consider without a discussion of its purpose and benefits.

Other terms like "investment reserve," "premium return," or "policy dividend" may imply different aspects of the insurance product but do not fully encompass the primary function of the cash value as being a type of savings that is cultivated through consistent premium payments.