What is the main feature of Single Premium Whole Life Insurance?

Single Premium Whole Life Insurance is characterized by being funded through a one-time lump sum payment. This distinctive feature sets it apart from other types of life insurance policies that typically require regular, ongoing premium payments (like in the case of annual premiums) throughout the life of the insured.

With Single Premium Whole Life, once the initial lump sum payment is made, the policy is fully paid up, meaning that no further payments are needed. This can be advantageous for individuals who prefer to make a single investment rather than commit to regular monthly or annual payments.

Additionally, this type of insurance builds cash value over time, which can grow at a guaranteed rate, and offers lifelong coverage as long as the premiums (in this case, the single lump sum) are paid. It does not involve investment in stocks, thus the cash value growth is not variable and is based on the insurance provider's participation rate, not performance of a stock market index.

Moreover, the coverage is not limited to a fixed term of time, such as five years, but rather extends to the whole life of the insured. Therefore, the one-time payment structure is fundamentally the main feature that defines Single Premium Whole Life Insurance.