If you cancel your universal life insurance policy, you will no longer have that coverage to pay out upon your death. Likewise, you will no longer owe any premiums.
If your policy has cash value at the time that you cancel it, you can collect that, minus any fees and/or surrender charges. If there is not enough cash value in the policy to collect anything, the policy simply ends.
Insurance Adviser - Broker, SC Insurance Services, Oahu, Hawaii
Universal life policies are somewhat tricky. What happens when you cancel a universal life policy depends on when you cancel the policy. In the beginning years of a UL it has no cash value accumulated, so if you cancel during that stage nothing happens other than the policy terminates. You get no money back. In the mid range years of the policy it will likely have some cash value, so if you cancel it during that period you may receive the cash value. In the later years of a UL, unless you have kept pace with the increasing "cost of insurance", (in other words paid increasingly higher premiums), the cash value that has accumulated may be reduced by they increasing cost of insurance until there is no more cash value remaining. At that point the policy may terminate. So if you cancel the policy while it has cash value you will receive the cash value. If there is no cash value when you cancel the policy it will simply terminate.
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If your policy has cash value at the time that you cancel it, you can collect that, minus any fees and/or surrender charges. If there is not enough cash value in the policy to collect anything, the policy simply ends.