Whole life insurance builds cash value through a portion of the policyholder's premium being allocated to a cash value account, which grows over time. This cash value accumulates on a tax-deferred basis and can be accessed by the policyholder through withdrawals or policy loans. The growth of cash value is typically guaranteed and may also be supplemented by dividends, depending on the type of whole life policy. The cash value can serve as a source of funds for various purposes, such as supplementing retirement income, funding a child's education, or providing a source of emergency funds. It's important to note that accessing the cash value through withdrawals or loans may reduce the death benefit and could have tax implications, so it's advisable to consult with a financial advisor or insurance professional before making any decisions regarding the cash value of a whole life insurance policy.