If you’re are having concerns about the cash surrender value on your life insurance ask your insurance agent at Bye Financial Group LLC, in Grand Ledge, MI.
Cash surrender value of a life insurance policy is the amount of money the insurance company is willing to pay the policyholder. The cash value is like a savings account on a life insurance policy, specifically a whole life policy. It is also known as ‘surrender value’ and ‘cash value’.
The cash surrender amount is the savings part of a whole life insurance policy that is payable to the policyholder before death. Nevertheless, during the first years of the life insurance policy, there is very little cash to be surrendered.
Cash surrender value is the collected portion of a permanent policy’s cash amount that is accessible by the policyholder if they choose to give up the policy. Its part of the cash value is taken by the holder then the death benefit amount decreases by whatever was withdrawn from the policy.
Retrieving the Cash Surrender Value
Most life insurance policies guarantee the cash value, but it can only be cashed in when the policy is canceled. Although, you may borrow part of the cash value to use with a low-interest rate it is similar to a small loan from a bank. If you do not repay the amount “borrowed” from the policy again the amount at death will not include the amount borrowed. amount. The loan is tax-free unless your cancel the policy after the cash value is surrendered then it is taxable and treated as income.
If you need a life insurance policy call our agent at Bye Financial Group LLC, in Grand Ledge, MI. We are more than happy to assist you and answer any questions and address any concerns you may have.