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 ?
Manulife returned $26.7 billion to our customers in the form of insurance claims, cash surrender values, annuity payments and other benefits.
Because some of the new UL products at that time veered toward investment vehicles -- with cash surrender values -- and away from traditional definitions of life insurance, the federal government stepped in with the Deficit Reduction Act of 1984 (DEFRA).
The present quarter includes a USD6.7m expense associated with decreases in cash surrender values of company-owned life insurance policies.
Its concern was that once the cash surrender values in the policies funding these agreements exceeded the sum of the premiums paid, the policy owners had access to untaxed funds.
(5d) Likewise, the Tax Court has held that the cash surrender values of paid-up additions are not constructively received by the policyholder.
This kept the cash surrender values from increasing, which limited the amount of life insurance that could be purchased from the cash value.
The company said that the current quarter includes a USD3.6m (USD0.08 per share) decrease in the cash surrender values of company-owned life insurance (COLI) policies, while the corresponding prior-year quarter included a USD3.7m (USD0.08 per share) increase in COLI policies.
Holders of life insurance policies with cash surrender values would be notified of that amount on an annual basis according to legislation introduced by Assemblyman Arthur J.
With cash value insurance the excess of net premiums paid (i.e., the premiums paid less dividends declared, if any) over the increase in cash surrender values is considered an insurance expense.
in BOLT Assets ($ Thousands) Cash Surrender Values of BOLI in Force Bank Molding % Rank Company Assets 2008 2007 Change 1 Bank Of America $1,173,478 $20,886 $16,760 24.6 2 Wachovia 808,575 14,851 13,677 8.6 3 JPMorgan Chase 1,642,862 13,684 13,074 4.7 4 Citigroup 2,199,848 7,626 3,325 129.3 5 Wells Fargo 595,221 5,553 4,523 22.8 6 U.S.
* The annual $15,000 premiums for the first 20 years produce similar projected cash surrender values in the CAUL and SGUL illustrations.
Surrender of the policy within the first five to 10 years may result in considerable loss since cash surrender values reflect the insurance company's recovery of sales commissions and initial policy expenses.