One major feature of whole life insurance is that it builds cash value. The company that holds your policy invests the cash and the cash value is a return on the investment. This value is tax-deferred until you withdraw it. If a need arises, you can also borrow against your accrued cash value, giving you added flexibility and benefit to the Whole Life insurance plan. Please remember that any amounts borrowed would reduce the death payout. If a claim is filed on your policy, the amount of the payout would be reduced by the amount of the withdrawal and any interest due.