It seems to be a common theme of ordinary whole life insurance coverage that each benefit helps supply another one.
The entirety of a contract provides lifelong protection. Due to the length of time you are covered, the regular premium payments can be spread out so that you can pay them at a lower cost. These level premium payments then allow for the policy to accumulate a reserve of cash that can be used at a later time to take out a loan on a house or pay for college tuition.
As Edward E. Graves, author of “McGill’s Life Insurance” points out, as the policy matures, this reserve will slowly reach a substantial level and get to a point where it equals the policy’s total face amount.
It should be noted that the cash reserve typically starts to accrue a year or two after the policy is in force. Also, with most cash value policies, you will pay more at the start of the policy until the cash reserve accumulates and will not reap savings until the policy matures.
However, many still believe ordinary whole life insurance offers the best combination of lifetime savings and protection for your family.