The cash value in any life insurance policy does not belong to the owner of the policy. The cash value is an asset belonging to the insurance company which they will use to pay the claim, which will surely come due, when the insured finally dies. Now if the owner of the policy would relieve the insurance company of the obligation of paying the claim, by cancelling the policy or lapsing the policy, the cash value in the policy is no longer needed by the insurance company, so they will give it to the owner of the policy under the terms of the policy's "non-forfeiture" clause.
People often ask "If that's my cash value, why don't I get it when I die in addition to the insurance benefit?" There's two reasons. First, you're dead and can't cash a check. Second, it's NOT your cash value. It's just easier for the agent to pretend that it is. Don't worry, though. You can have it if you take the company off the hook. That's only fair.
Well it depends on the type of "Cash Value" life insurance a person has. If you have a Universal Life policy then there is a greater than not that you will lose the cash value (savings, accumelation account, etc.). It really depends on the OPTION that was picked (done usually by the agent)? Sometimes known as Option 1 or 2, A or B which means what will be explained in the policy itself.
The insurance companies that sell these types as well as Whole Life, Variable Life, Variable Universal Life (also known as V.U.L.) make it really confusing for the unsuspecting consumer to easly understand but I'll try to explain it to you...
The two OPTIONS offered are there based on wheather or not you will receive the cash value. It's the wording that makes you want to scream, if you look in the table of contents you'll find "Policy Proceeds" or "Death Benefit Options", once there you'll read something like this...
"Upon proof of death of the insured, the benefit under Option 1 (or A) is the greatest of:"
1) The face amount; or2) The accumulation account value on the insured's death.
under Option 2 (or B), the death benefit is greater of:
1) The face amount plus the accumulation account valueon the date of the insured's death; or2) The accumulation account value multiplied by the applicable percentage from the table of Death Benefit Percentages shown below."
You see what I mean, most people don't read their policies and when they start I'm sure they get dizzy on account of the way it is written, and don't think it was by accident either. I believe that policies are designed that way on purpose to discourage anyone from just picking it up and reading it.
That's why in the front of the policy is says "This is a contract, PLEASE read it carefully." what a joke!!!
In any case, I say Buy Term and Invest the Difference" like my wife and I have. You won't be sorry!!! If you want me to reffer you to someone go ahead and email me, I'll be glad to help out and also THANKS to FaqFarm for the opportunity to respond.
I welcome any comments or views, just don't think I'll automatically agree, I AM VERY knowledgable about life insurance and the "scams" comapnies and their agents pull against American Families.
With almost all cash value life insurance policies, you have access to the cash when you are alive. If you were to die, the company keeps the cash value and pays your beneficiaries out the death benefit.
Pays out to beneficiary-just the value of coverage not cash value if sold.
Depends on how it is set up. My policy has a death benefit that actually increases by more than my cash value over the years so if i die my beneficiaries get the original face amount PLUS the cash value and then some!
You do not get full value.
It is the value or total of cash accumulating in the cash value account
It is the value or total of cash accumulating in the cash value account
The paid up life would have it's extra cash value too, so if you cashed it in for the cash value, there would be no more paid up life either.
The cash value of something is the value before taxes. Net or Netto cash value is after taxes.
"Cash surrender value" also known as "cash value" or "policyowner's equity value" is the monetary amount an insurance company will give the policyholder or annuity holder if the policy is voluntarily terminated before maturity or before the insurable event happens, (ex. death, disability).
Face value typically refers to the death benefit of the policy (i.e. how much your family would receive if you were to die). Cash surrender value is the amount of money that has accumulated (tax deferred) inside the policy and is the amount of money the owner would receive (before taxes) if s/he were to cancel the policy. Cash surrender value is different from plain old "cash value" or "accumulated value" in that most insurance policies have surrender charges for 10 to 20 years that reduce the total "cash value" or "accumulated value" down to the cash SURRENDER value.
no cash value
How do you calculate the actual cash value of a home
Cash value of whole life insurance is referred to as the "Cash Surrender Value". The cash surrender value is money the policyholder is supposed to receive from the insurance company when surrendering the whole life insurance policy with cash value. The cash surrender value amount due is the sum of the cash value stated in the whole life insurance policy minus any surrender charge and any outstanding loans and interest due on the loans.
Term insurance may or may not have cash value at some point. It has no value when it expires. For example, If a person bought term insurance at 30 which would expire at 70, it could have some cash value when that person was between the ages of 40 and 60. Term life starts losing cash value when people start dying. It becomes worthless when it expires. If you want to use your term life insurance policy, you will need to die before it expires.
Not all insurance policies have cash value. Term life has no cash value. Whole life does have cash value. You will have to talk to your insurance company and tell them what you want. If you have a whole life policy with cash value, then withdrawing that cash is essentially like taking money out of a bank account; very simple.
No,, You get paid "Fair Market Value", which is often the same as Cash value.
Cash value of a policy is the value or worth of the policy in the local currency, if surrendered immediately.
Typically it is called "Net Cash Surrender Value". This is the amount of cash value in the policy accumulation account minus any outstanding loans etc. But it is typically referred to as "Net surrender Value" or "Net Cash Surrender Value". Get a good agent and he can explain.
The website Insure shows one how to calculate the cash value of Life Insurance. Their model shows what could happen to the cash value and death benefit if one taps his/her cash value to pay premiums.
Enterprise value is the present value of free cash flows a company can generate.Enterprise Value = Market Value of Equity + Debt - Cash
Can I get the answer on line, or do i HAVE to call in? Where can i GET the cash value for my policy?
Yes, if your life insurance policy has accumulated cash value. Not all life insurance policies will accumulate cash value: for example, term life insurance policies will not accumulate any cash value. Whole Life and Universal life policies can accumulate cash value and the policy owner can take loans in the limit of the cash value (some companies limit loans to 70 - 80% of the cash value).
The government cannot garnish a life insurance cash value policy. However, they can attach a lien on the cash value if it is deposited into a bank account. They can also petition the court to force an individual to hand over the cash value.
The face value is what your beneficiaries will collect. The cash value is the excess of your premium payments over the cost of the insurance. Click here for more about life insurance cash value.
Once they die you have to cash it if you want to get the benefit of it. The policy does gain any more value after they die so its in your best interests to make the claim and get the payout.
Yes, if you have a policy with cash value. Term policies have no cash value. Permanent policies designed to develop cash value probably have no value if they are newer than 3 years old. Contact the insurance company for a surrender value. Also ask what other options you have (loans, stop premiums, etc).