Cash value

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Cash Value

The amount of cash that becomes available to an insured person upon the cancellation of his/her insurance policy. Most often, this applies to the savings portion of a canceled whole life policy. This value is considered an asset and can be borrowed against or used as collateral. It may also be called a cash surrender value or a surrender value.

Cash value.

Cash value is the amount that an account is worth at any given time.

For example, the cash value of your 401(k) or IRA is what the account is worth at the end of a period, such as the end of a business day, or at the end of the plan year, often December 31.

The cash value of an insurance policy is the amount the insurer will pay you, based on your policy's cash reserve, if you cancel your policy. The cash value is the difference between the amount you paid in premiums and the actual cost of insurance plus other expenses.

References in periodicals archive ?
Loans: Home mortgage, real estate, home equity line of credit, life insurance cash value loan, 401 (k) loan, auto loan, student loan, and any other personal or investment loans except credit cards.
It shows how taxable mutual fund growth and tax-deferred life insurance cash value growth affect the overall cost of the plan for a hypothetical plan year.
life insurance cash value plus accumulation annuity -- $60,000
Any irregular distribution of life insurance cash value received on or after the annuity starting date is taxable once all investment in the contract has been recovered (FIFO rule).
The life insurance cash value portion of the portfolio represents a bond-like asset, based upon the life insurer's conservative portfolio of investments underpinning its long-term commitment to policyholders.
Guarantee Advantage Universal Life is designed for value-conscious consumers who are not focused on life insurance cash value growth, and instead want to maximize their permanent life insurance protection and minimize premium rates.
In the event there is no premature death and if the key employee stays with the business for the length of the Golden Handcuffs contract, then the life insurance cash value may be accessed to provide a retention bonus.
If no longer needed, the life insurance cash value can be transferred to an annuity contract.
Ed is an accountant who explains that the most important benefit in our tax code is the tax exclusion for life insurance cash values and death benefits if the policy is established correctly.
Taxing the internal buildup of life insurance cash values on an accrual basis
Variable life insurance cash values are not guaranteed and will fluctuate based on the performance of underlying investment options.

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