Yes. With permanent coverage, the business can generally use the cash value through a policy loan, a withdrawal or as collateral for a bank loan. Each one affects the death benefit, and a policy loan or withdrawal can be taxable. Growth inside the policy is generally tax-deferred, and in an exempt policy it doesn’t count as the business’s passive income each year.
Can a business access the cash value of permanent life insurance?
Reviewed by Garrett Agencies Ltd., October 2026. How we write
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More about business-owned life insurance
Life insurance held by the corporation, for funding obligations and planning ahead.
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