Whole Life Insurance as a Financial Asset

Whole life insurance offers a combination of features and benefits that differentiate it from most other financial products. These include:

Permanent Life Insurance: Whole Life provides lifetime coverage with guaranteed level premiums.

Cash Value Accumulation: The policy builds cash value over time, which is guaranteed to increase each year and will never decline in value due to market conditions.

Policy Dividends: Policyowners are eligible to receive annual dividends, which are not guaranteed. You may receive dividends in cash, use them to reduce your out-of-pocket premiums or increase your life insurance protection and cash value.

Income Tax Advantages: Whole life offers valuable income tax advantages that include:

  • A death benefit that is generally received income tax free.
  • Tax-deferred cash value accumulation.
  • Tax-advantaged access to cash values.


Additional Benefits: Optional benefits are available through policy riders designed to help you:

  • Get the coverage you need at a premium you can afford.
  • Guarantee that you can purchase additional life insurance in the future.
  • Keep your coverage in place if you become disabled3 and are unable to pay premiums.
  • Use your policy to help pay for health care expenses during retirement.

Whole life insurance is a versatile financial asset that can play an important role in your overall financial strategy.

Protect your value as a provider — Your family depends on what you provide for them. A whole life insurance policy can help protect their financial security.

An additional financial resource — The cash value that your policy accumulates can be a source of cash or credit during a time of need.

Supplemental retirement income — Your policy may be an effective way to accumulate additional funds for retirement. It offers stable and consistent cash value growth and the potential for tax-advantaged distributions. It may be alternate source of supplemental income during market downturns.

Life insurance protection in retirement —

Life insurance can provide additional financial security for your spouse and family during retirement. This may allow you to spend more of your other retirement assets to enjoy a more secure and comfortable retirement.

Heath Care Planning — Many of MassMutual’s whole life polices offer optional benefits that allow you to use your life insurance to help pay for the cost of health care, if certain criteria are met. There is an additional cost for this feature.

Estate Planning — If leaving a financial legacy is important to you, life insurance is an effective way to provide for your family’s future.

Income tax advantages

Income Tax-Free Death Benefit

Tax-Deferred Cash Value Growth

Tax-Advantaged Distributions

The information provided is not written or intended as specific tax or legal advice. MassMutual, its subsidiaries, employees and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel.

The decision to purchase life insurance should be based on long-term financial goals and the need for a death benefit. Life insurance is not an appropriate vehicle for short-term savings or short-term investment strategies. While the policy allows for loans, you should know that there may be little to no cash value available for loans in the policy’s early years.

1 Distributions under the policy (including cash dividends and partial/full surrenders) are not subject to taxation up to the amount paid into the policy (cost basis). If the policy is a Modified Endowment Contract, policy loans and/or distributions are taxable to the extent of gain and are subject to a 10% tax penalty if the policy owner is under age 59 1/2.

2 Riders are available at an additional cost, or there is a charge when the rider is exercised. Availability of some riders may be limited based on issue age or state of issue.

3 Based on the definition of disability in the policy rider.

Access to cash values through borrowing or partial surrenders will reduce the policy’s cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured.