What’s a cash surrender value11
A cash surrender value is the amount of money you can receive if you decide to cancel your policy. You can also benefit from the cash surrender value without forfeiting your insurance coverage.
You can use your policy's accumulated cash surrender values (guaranteed or non-guaranteed 💡) at any time.
Here are a few options:
1
You can withdraw the non-guaranteed surrender value generated by the paid-up additions12
Depending on the dividend option you’ve selected, you can access the policy’s cash value different ways. With the Paid-up Additions, Enhanced Insurance and Dividends on Deposit options, you can receive the non-guaranteed cash surrender values. The amount surrendered will then be deducted from the total cash surrender values and the amount payable upon death.
Participating life insurance allows you to take advantage of high cash surrender values, which you can use during your lifetime12 to meet financial obligations, deal with unexpected events or finance projects that are important to you.
2
You can request a partial or total surrender12
With participating whole life insurance, you can partially surrender your basic insurance coverage. The death benefit will be reduced based on the cash surrender value requested. Total surrender of the policy is also possible by terminating your coverage.
3
You can apply for a policy loan12
You can request a loan of up to 100% of your policy's cash surrender values. The available cash surrender values include all guaranteed cash surrender values less any outstanding loan balance. The loan is considered an interest-bearing loan. Loan repayments can be made at any time and all outstanding policy loans reduce the amount payable upon death or the payment on surrender.
4
You can ask for premium payments to stop and opt for reduced coverage
If you choose to stop paying premiums, you could use the cash surrender values to purchase a reduced paid-up insurance policy. This allows you to keep coverage for life at a lower cost than the initial coverage. The cash surrender values are then used as a single premium for this new insurance amount. The reduced paid-up insurance amounts are shown in the policy.
You may still be entitled to dividends under the reduced paid-up insurance. These dividends are credited based on the dividend scale in effect at the time. The reduced paid-up insurance amounts associated with the basic insurance coverage are guaranteed and vary by product.
When reduced paid-up insurance is purchased:
- The Enhanced Insurance option is replaced by the Paid-Up Additions option.
- The Annual Premium Reduction option is replaced by the Dividends on Deposit option.
11 Options vary based on the product chosen.
12 May lead to a taxable policy gain.