1. 12689 POINTS
    Ted RatliffPRO
    Owner, SFS Associates,
    The Cash Surrender Value is the value of the policy if you surrendered the policy. This is different than the face amount. You can find a table of Guaranteed Surrender Values inside your policy. A Whole Life Policy will have several provisions designed to give you options should your economic situation change. You may borrow off the Cash Value if you need to. You can use the Cash Value to provide a reduced paid up insurance policy. You can allow the policy to pay for extended term insurance, which keeps the policy going until the cash value is used up. This is a big advantage in my opinion over other life insurance policies.
    Answered on April 9, 2013
  2. 4330 POINTS
    Jerry Vanderzanden, CLU, ChFCPRO
    Co-Founder, Coastal Financial Partners Group, California
    There are basically two kinds of life insurance you can own: term and permanent. Term life insurance is temporary - it covers for a limited period of time before the coverage ends and it has no living (asset) value. Permanent life insurance is designed to pay a death benefit to last a lifetime, regardless of when you die. The premium is higher than term because it has to last longer and build a cash reserve to help keep the premium level. The cash reserve means the insurance company can offer a cash value to the owner that grows over time. At any given point in time, the cash surrender value is the amount that the insurer will pay the owner if the owner cancels the policy.
    Answered on April 9, 2013
  3. 3485 POINTS
    J Scott BurkePRO
    President, Newbury Inc., Evansville, Indiana
    The cash surrender value is the portion of your insurance that you have built up your own money in. Whole-life insurance by design is really like a reducing term policy with a cash account that builds guaranteed cash value as you get further and further into the policy years.

    All whole-life policies have a maturity date where your cash has built up to the point that you are completely self insured and the actual insured portion (the part the insurance company has at risk) has gone to zero.

    You can use your cash value while you are living through policy loans, cash surrenders, or using it to buy reduced paid up insurance.
    Answered on April 9, 2013
  4. 400 POINTS
    Zachary Wright
    Owner, Wright Insurance Agency, Great Pittsburgh Area
    In permanent life insurance, the policy will gain cash value which is yours to do with as you see fit. You can leave it there to gain more cash, withdraw it for personal use, etc. The cash surrender is usually put in to deter people from letting the policy go and can be anywhere from 5 to 20 years. It is basically a monetary penalty against the cash you've accrued in the general account.
    Answered on April 9, 2013
  5. 0 POINTS
    David RacichPRO
    Fountain Hills, Arizona
    Cash Surrender Value on a Life Insurance Policy will vary from company to company. Surrender charges can be punitive in the first 5-7 years of a policy and can extend out to 19 years with some companies. The account value less the surrender charge debited is the surrender value. Most life insurance policies are illiquid in the early years. 

    Answered on May 27, 2013
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