Cash Surrender Value

Posted in Finance, Accounting and Economics Terms, Total Reads: 860

Definition: Cash Surrender Value

The amount of money a policyholder receives in case the person redeems his/her policy before the termination date is referred to as cash surrender value. This amount if less than the amount the person would have received if he had terminated the policy at the maturity or in case of any event.


Surrender values exist only in investment-cum-insurance policies like endowment plan, money back plan and unit-linked insurance plan (ULIP) since they originate from the investments of the insured. Some ULIPs can be surrendered after one year but mostly it is redeemable after a period of 3 years and it is a participating policy.


Most companies provide a surrender request form which can be filled for existing policies on the company’s own website. Costs incurred are agent’s cost and administrative cost and are subtracted from total corpus of funds received.


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