CASH SURRENDER VALUE
The amount of money that an insurance company
pays the insured upon cancellation of a life insur-
ance policy before death and which is a specific fig-
ure assigned to the policy at that particular time,
reduced by a charge for administrative expenses.
The cash surrender value of an insurance
policy is not based upon its actual value, but
upon its reserve value—the face amount of the
contract discounted at a specific rate of interest
according to the insured’s life expectancy.Not all
life insurance policies have cash surrender values;
the terms of the policy must so provide.
