Yes, someone can cash in their life insurance if there is cash value in the policy. If it is early in the years of a cash value policy (Whole Life or Universal Life), surrender charges will be subtracted from the cash value.
There are other options for many policies that you may want to explore. E.g. you could possibly make your policy into a reduced paid up policy. You would not have the cash value to spend, but you would still have some life insurance for which you no longer have to pay a premium.
Visiting with your agent can be helpful in making the decision whether or not to cash in your life insurance.
Assuming you’re addressing permanent life insurance that has accumulated cash values, the following are some considerations before you cash in your life insurance. Any gain in the policy will be taxed as ordinary income at the surrender or “cashing in” your policy. And cashing in the policy terminates the coverage.
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There are other options for many policies that you may want to explore. E.g. you could possibly make your policy into a reduced paid up policy. You would not have the cash value to spend, but you would still have some life insurance for which you no longer have to pay a premium.
Visiting with your agent can be helpful in making the decision whether or not to cash in your life insurance.