If a policyholder or the owner of an annuity contract chooses to cancel their policy before it matures or an insured event happens, the insurance company will give them the Cash Surrender Value. The cash surrender value of a life insurance policy is the net amount payable to the owner of the policy, less any indebtedness on the contract. For example, if you have a $100,000 life insurance policy and your insurer owes you $10,000 in death benefits, then your cash surrender value would be $90,000.Cash surrender values can be quite important for people who hold life insurance policies or annuity contracts. If something happens and they need to get their hands on that money quickly, having a large cash surrender value can make it much easier to do so. Conversely, if someone doesn't need access to that money right away they may want to consider choosing a plan with a lower cash surrender value so they don't have to worry about it as much down the road.In any case though, it's important for everyone shopping for these types of policies know what their options are in terms of cashing out and how that will impact them financially both in the short-term and long-term.
