Permanent life insurance is permanent up to a point, and the point has a date on it. That date is the maturity date, and on most policies written in the last twenty years it falls on the policy anniversary nearest the insured's 121st birthday. Contracts written on older mortality tables often matured at 95 or 100.
Maturity means the contract ends while you're still alive. The insurance company pays out the cash value, the coverage stops, and the policy is over. The industry word for it is endowment, because the contract endows. That means the cash value has grown up to equal the death benefit, so there's nothing left to insure.
Two things about that payout matter. First, it isn't a death benefit, so it doesn't get the income tax treatment a death benefit gets. Cash value received at maturity is taxable on the amount above your basis, and basis means the premiums you put in. A policy funded for forty years can hold a large gain, and all of it lands in a single tax year. Second, if there's a loan against the policy when it matures, the loan is settled out of the proceeds and the gain is still calculated on the full amount. So a loaned-up policy reaching maturity can produce a tax bill bigger than the cash that shows up. It's the same arithmetic that makes a loaned-up lapse so painful, and the tax bill that arrives when a loaned-up policy lapses walks through it.
Living to 121 was a rounding error when these contracts were designed, and it still is. The reason 121 replaced 100 is that people started reaching 100, and carriers found themselves handing a taxable check to someone who'd been paying for a death benefit since 1965.
Most modern contracts handle it with a maturity extension provision, sometimes sold as a maturity extension rider. Where it exists, the policy just keeps going past the maturity date. The death benefit stays in force at the cash value amount. Premiums and cost of insurance charges usually stop. And the money eventually goes to the beneficiary as a death benefit instead of as a taxable payout. Carriers differ on whether it's automatic or has to be elected, and on what happens to an outstanding loan. Some extension provisions are silent on the tax treatment, because the IRS has never ruled on all of it.
Look at the data page of your policy and find the maturity date. If the insured is 40 today and the date reads 2106, you own a 121 contract and this is a footnote. If you're holding something written in the 1980s, check whether it matures at 95 or 100. Same for an old policy that came out of a parent's file. An insured who's 82 right now is a lot closer to that date than anybody planned for. An in-force illustration shows exactly what the carrier projects at the maturity date, and what an in-force illustration shows that your annual statement doesn't covers how to order one.
I'm a licensed insurance broker and not a CPA. A 1035 exchange, which means moving the cash value into a newer contract without triggering tax, is a real option at 80 and not much of one at 99, so the timing on this matters more than the topic suggests. If you own an older contract with a maturity date inside a realistic lifespan, write the carrier this month. Ask two things: is a maturity extension available on this specific contract, and what does it do to an outstanding loan.