Which type of insurance policy guarantees cash values over time?

Permanent life insurance is the type of insurance policy that guarantees cash values over time. This form of insurance not only provides a death benefit to the beneficiaries upon the insured's passing but also accumulates cash value that policyholders can borrow against or withdraw during their lifetime.

The cash value component is a significant feature that grows on a tax-deferred basis, allowing the funds to accumulate without incurring immediate tax liability. This aspect can provide financial flexibility as it serves as a living benefit for the insured.

Unlike term insurance, which strictly offers a death benefit without any cash value component, permanent life insurance encompasses several variations, such as whole life and universal life, which create a savings component that can grow in value. Accidental death insurance also does not offer any cash value, as it is designed solely to pay a benefit in the event of an accidental death. Therefore, permanent life insurance distinguishes itself by ensuring cash value accumulation over time.