If you wish to cancel your Cash Value Life Insurance policy because of the higher premiums or a change in your financial condition, then we are here to help you.
Cash Value Life Insurance is a life insurance policy meaning when you die a death benefit is paid to your beneficiaries. Cash value lets you access your money, you can get that money at any age.
In this article, we have tried to provide you with all the information that you need to know before canceling a Cash Life Insurance Policy.
What Are The Advantages And Disadvantages Of Cash Value Life Insurance?
Before you cancel your Life Insurance, you must look at the advantages or disadvantages of the policy that can help you decide whether to cancel it or not.
Advantages Of Cash Value Life Insurance
- A death benefit to the beneficiaries when the policyholder dies
- Tax advantages when you borrow money
- Provides life-long protection
- You can add riders, and in serious medical conditions you can take the death benefit
Disadvantages Of Cash Value Life Insurance
- Premiums are very high
- Take a long time to build
- The policy will lapse if the minimum cash value is not maintained
- You have to pay taxes for withdrawal or termination
How To Cancel A Cash Value Life Insurance?
If your policy has a cash value, then you can access that money anytime you want without the need to surrender the policy. However, If you want to surrender your Cash Value Life Insurance policy, you can follow the below steps:
1. Contact The Issuer
You need to get in touch with your insurance company to submit a request for the termination of the policy.
2. Review the policy
Since all companies have different terms and conditions, you need to thoroughly review the policy, terms, and conditions before applying for cancelation.
3. Cash Out the Policy
Cash Value accounts gain interest over time that amount can be withdrawn anytime for any use. But if you decide to cancel the policy you will have to pay taxes or penalties.
4. Check For Alternatives
When you cancel the policy, you will not get all the benefits that the beneficiary may get after the maturity of the policy. If you are in urgent need of money you can try other alternatives like using the cash value, taking out loans, etc.
Also, read How To Cancel Humana Insurance Policy?
How To Utilize Cash Value Life Insurance?
Cash Value Life Insurance is one of the best investment options. You just need to be aware of the benefits that your policy can give you. The main purpose is death benefits but there are other benefits as well.
You can utilize your cash value in many ways like, tax-free savings, taking loans against the cash value, using the money as retirement income, and also temporarily paying the premium of the policy.
Frequently Asked Questions
What Is The Surrender Value In Life Insurance Policy?
The amount paid by the insurance to the policyholder when he surrenders his policy before the maturity date.
Can We Cancel An Insurance Policy Online?
Yes, you can cancel your insurance policy online by visiting the issuer’s website.
Can We Cancel An Insurance Policy For Free?
The insurance companies provide a free Look Up period of 15 days to review your policy and you can cancel the policy during that period for free.
Conclusion
The process of canceling a Cash Value Life Insurance policy is complex and confusing at times. You must review the policy first, contact the policy company, and find ways to make the most out of your Insurance Policy. However, we have provided you with the information and ways to cancel a Cash Value Life Insurance Policy.