Which type of policy provides immediate cash value?

The single premium policy is designed to provide immediate cash value because it is funded with a one-time lump-sum payment. This upfront payment creates an instant cash value that the policyholder can access, often through loans or withdrawals, quite quickly after the policy's issuance. Unlike other types of policies, a single premium policy does not require ongoing premium payments; instead, the initial investment secures both the life insurance coverage and the cash value from the outset.

In contrast, whole life policies also accumulate cash value over time, but it typically takes several years before the cash value is significant enough to be considered "immediate." Term life policies do not accumulate cash value at all, as they are designed strictly to provide death benefit coverage for a specified period. Universal life policies also have a cash value component, but the cash value grows over time based on premium payments, which means it does not provide immediate cash value either.