What Is Accumulation Value When I Want to Surrender My Life Insurance?

••• Keith Brofsky/Photodisc/Getty Images

An advantage of permanent life insurance, aside from the death benefit, is the accumulation of cash inside the policy. Permanent policies build equity, and you may access this money if you surrender your policy.

Cash Value Accumulation

A small portion of your payment is set aside into a separate account within your policy. This is your cash value, and the type of policy you have determines how interest is credited. Many carriers refer to cash value as “accumulated” value.

Surrender Period

The surrender period is the length of time you must keep the policy to fully access to the accumulated value. This helps carriers recoup the expense of establishing your policy.

Surrender Charge

The surrender charge is the percentage of your cash value that the carrier keeps if you cancel your coverage before the end of the surrender period. This percentage reduces every year until eventually diminishing to zero.

Surrender Value

The surrender value is the actual amount of money you will receive if you cancel your policy before the end of the surrender period. The surrender charge percentage is subtracted from the cash value, and the balance is refunded to you.


The accumulation value can be accessed without surrendering your policy. At any time, you can request a loan for the cash value. Surrender charges are not imposed on policy loans, and there is no restriction on when you can borrow the cash value.