What Life Insurance Builds Cash Value? 
The actual cost for providing insurance for one year increases as an individual ages . In order to provide a level death benefit in exchange for a level premium , insurance companies must charge more at the younger ages to offset the cost at the older ages . This extra money becomes the cash value of a permanent life insurance policy . Permanent life insurance policies come in several stripes depending on guarantees included in the policy . The company will surrender the cash value at any time in exchange for a release from the companys promise to pay the death benefit . They will also allow the owner to borrow against the cash value of the policy . 