Permanent life insurance, also known as whole life insurance, is a life insurance policy which will remain in force for the policy owner’s lifetime.

Permanent life insurance offers several advantages over a term life policy. Permanent life insurance policies offer a savings component often referred to as a “cash value” component. This cash value can be borrowed against while the policy remains in effect or “cashed out” in the event the policy is terminated. The cash value component will also grow tax free during the life of the policy.

As permanent life insurance remains in effect until the death of the insured it can be a useful tool for estate planning. As the death benefit is not taxed a permanent life insurance policy can be used to simplify estate planning.