What is a primary characteristic of whole life insurance?

Whole life insurance is primarily characterized by its guaranteed cash value growth. This means that as policyholders continue to pay their premiums, the cash value component of the policy accumulates over time at a guaranteed rate set by the insurer. This accumulation provides a financial resource that can be accessed by the policyholder through loans or withdrawals, and it acts as a savings component in addition to the death benefit.

The stability of cash value growth is a fundamental aspect of whole life insurance, which differentiates it from other types of insurance that may not offer such a feature. Unlike term insurance, which only provides a death benefit without any cash value component, whole life insurance ensures that policyholders have a savings element that grows over the life of the policy, enhancing its value. This makes whole life insurance an attractive option for those looking for both protection and an investment component.