What is a primary advantage of whole life insurance over term life insurance?

Whole life insurance offers the significant advantage of accumulating cash value over time, which is a key distinguishing feature compared to term life insurance. This cash value component grows at a guaranteed rate and can be borrowed against or withdrawn by the policyholder, providing financial flexibility and potential additional benefits, such as being able to use it for emergencies or to supplement retirement income.

In contrast, term life insurance provides coverage for a specific period and does not include a cash value component; thus, once the policy expires and if no claims are made, there is no financial return to the policyholder. The accumulation of cash value in whole life insurance can make it an appealing option for individuals looking for both life insurance protection and a savings element.