A life insurance policy that combines a death benefit payment to the policyholdersÂ’ beneficiary along with a savings vehicle that accumulates the policyÂ’s cash value. The cash value is determined by the return that the insurance company earns on its investments. The cash accumulates on a tax-deferred basis. Other types of whole life insurance that give the insured more options for selecting the underlying investment options are universal life policies, which typically invest in fixed-income securities and variable life insurance, which includes the options of investment in stock, bond, and money market accounts. Also called permanent life insurance.