Cash value account

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Cash Value Account

An account into which cash is deposited 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 account.

If you have a permanent life insurance policy, part of each premium you pay goes into a tax-deferred account called the cash value account.

You can borrow against the money that accumulates in this account, though any outstanding balance at the time of your death reduces the death benefit your beneficiary receives.

If you cancel or surrender your policy, or if you stop paying the premiums, you are entitled to receive a portion of your cash value account. That amount is your cash surrender value.

References in periodicals archive ?
Indeed, cash value accounts amount to more than 200 million in-force life insurance policies and total more than $3 trillion of unmanaged, invested assets.
VL and VUL policies have two broad classes of fees--charges to the policy and charges to the cash value account. Because of differences in the way premiums and face amounts are handled in VL and VUL policies, some of these fees and charges are treated differently in each type of policy.