Yes you can cash out or surrender life insurance. Life insurance is a unilateral contract where you, the policyowner, are in control.
Before you cash out a policy it is best to check with your life insurance broker to be aware of alternatives and any consequences including tax.
In Canada, if there is an irrevocable beneficiary or if the policy has been assigned as collateral, there permission would be required before taking any action including surrendering the policy.
If you have any questions, or feel I could be of assistance, please do not hesitate to contact me.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
The person who can surrender the policy is the owner or the assigned. The company will exchange the cash value of the policy for a release from paying a death claim. This transaction is relatively quick. Since the company’s promise to pay a death claim is a very big issue, care should be taken before surrendering a policy.
That is a great question! If your policy is a whole life policy, then yes, you can. If it is a term life policy, ( like AAA or AARP offer) then you cannot, as they have no value to them, unless you die and they pay out. The money you can collect from your whole life policy will be reduced by fees and any outstanding loans that you may have, so you know. I'd strongly recommend that you discuss your reasons for cashing out the policy, there are a lot more reasons why you shouldn't than there are for doing it. I hope that helps, thanks for asking!
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Before you cash out a policy it is best to check with your life insurance broker to be aware of alternatives and any consequences including tax.
In Canada, if there is an irrevocable beneficiary or if the policy has been assigned as collateral, there permission would be required before taking any action including surrendering the policy.
If you have any questions, or feel I could be of assistance, please do not hesitate to contact me.