Permanent insurance

permanent insurance

See cash-value life insurance.

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Permanent insurance. Permanent insurance is a life insurance policy that provides a death benefit as long as you live, or in some cases until you turn 100, provided you continue to pay the required premiums.

With this type of policy, a portion of your premium pays for the insurance and the rest goes into a tax-deferred account in your name.

With many permanent life policies, you can borrow against the cash value that has accumulated in the tax-deferred account. Any amount that you've borrowed and have not repaid at the time of your death reduces the death benefit.

If you terminate the policy, you get the cash surrender value back. Cash surrender value is the cash value minus fees and expenses.

Permanent life insurance, also known as cash value insurance, is available in several varieties, including conventional policies known as straight life or whole life, as well as universal life and variable universal life.