Why Does Life Insurance Have Cash Value? 
Permanent life insurance has the potential to accumulate cash values based on the performance of the crediting method and policy expenses . With few exceptions , most permanent guaranteed universal life insurance can be used as a supplemental retirement income plan ; if the policy is designed to minimize the cost of insurance ad comply with TAMRA . Generally , the policy expenses are deducted from the premium . Whatever is left of the premium is invested in the crediting method : interest rates or indices . Separate sub account performance may credit earnings or debit losses . 