Whole Life sometimes called "permanent insurance", or "ordinary life", is designed to stay in force throughout a person's lifetime. The policy remains in force as long as the policy owner pays the premiums, regardless of any changes in health that may occur. Premiums for most whole life policies remain level and can be paid on an annual, semi-annual, quarterly, or monthly basis. A portion of each premium payment is set aside to earn interest and over time, a whole life policy will develop "cash values." The accumulated cash values form a reserve which enable the insurer to pay a policy's death benefit, while keeping the premiums level. Whole Life insurance is better suited for long-term obligations like the lifetime income needs of a surviving spouse or family, estate liquidity, death taxes and funding retirement needs.
