The difference between what you pay for a life insurance policy and what it ends up costing you.
Cash value and dividends reduce the cost of life insurance below the premium amount. However, if you purchase a policy that doesn’t return any earnings or other value to you, the cost of your policy equals the cost of your premium.
For instance, if you pay $300 per month for a life insurance policy, over the span of a year you will have paid $3,600 in premiums. But if, at the end of the year, your insurer pays you $600 in dividends earned, your actual cost for that one year is only $3,000.