My answer to What is the cash value of a whole life insurance policy?
Answer by Jennifer Burnham-Grubbs:
Further to Chanfresca’s answer, the answer is also ‘it depends’. The cash value grows within a policy, tax-free. Depending on what guaranteed interest rate (or non-guaranteed interest rate) the policy offers, your cash value will grow at various rates. Some policies tie the cash value performance to an index that links with the S&P, for example. Others have flat guarantees (1%, 2%, 4%). There is whole life, universal life, indexed universal life, guaranteed universal life, even variable life (which I don’t recommend). All these types of policies fall into the general ‘bucket’ of life insurance that also can build cash value. Such policies work very nicely when designed strategically, with your best interest in mind (not the broker’s commission). Make sure, though, that you get good advice—it can make all the difference in the world when it comes to cash value performance.