Term life insurance policies typically do not have a cash value component. Unlike permanent life insurance policies, such as whole life or universal life, term life insurance is designed to provide coverage for a specific period of time, usually 10, 20, or 30 years. Term life insurance policies do not accumulate cash value over time. The primary purpose of term life insurance is to provide a death benefit to the beneficiaries if the insured person passes away during the term of the policy.
The absence of cash value in term life insurance policies is one of the reasons why they are generally more affordable compared to permanent life insurance policies. With term life insurance, you pay premiums for the coverage period, and if you outlive the term, the policy expires without any cash value.
It's important to note that while term life insurance policies do not have a cash value, they can still provide valuable financial protection for your loved ones in the event of your death. The death benefit can help cover expenses such as mortgage payments, college tuition, or other financial obligations.