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How To Surrender Life Insurance Policy?

Updated On Nov 12, 2021

Simply put, to surrender life insurance is to opt out of or cancel your policy. The process can be relatively simple, depending on the type of policy you have and whether or not it has a cash value or investment aspect. At the core, this surrender will involve notifying your provider, filling out necessary paperwork and the subsequent cancelation of your policy. 

Who Should Surrender Their Life Insurance?

People who no longer need their life insurance policy, or who have immediate financial needs, should consider surrendering it. Depending on the circumstances, surrendering your life insurance policy can be helpful. But if you still need a life insurance policy and you don’t have a replacement policy lined up, you should not surrender it. 

Why Surrender Your Life Insurance Policy?

There are a handful of reasons to surrender your life insurance. Perhaps you switched jobs, and your new employer offers quality life insurance for cheaper than what you’re currently paying. Or maybe you no longer have beneficiaries who need the death benefit, and you’re tired of paying the premiums. The third common reason for surrendering life insurance is to gain the cash surrender value of your policy. This final reason only works with life insurance policies that have a cash value factor built in.

The first example of switching jobs is an excellent reason to surrender a policy. If you have access to an equivalent or better life insurance policy for a lower price, there’s no reason to keep your policy. The second example of no longer wanting the death benefit is another good reason to surrender a policy. You won’t be able to spend your own death benefit, and if no one else needs it, you could potentially make better use of it.

How To Surrender Your Life Insurance?

Although steps may vary slightly by provider, these are the typical steps you’ll take to surrender your life insurance policy:

  • Contact your insurance agent and notify them that you would like to surrender your policy. Alternatively, you can visit your insurance company agent in person for this step. They will provide you with a surrender form to fill out and return. These forms can be given in person, sent via mail or even downloaded digitally.
  • Fill out the surrender form and make a copy for personal recordkeeping. This form is your legal permission and request to the company specifying that you wish to surrender your policy. The duplicate is for your records in case there are any mishaps down the line.
  • Mail the form to your insurance company and store the receipt of mail with your copy of the surrender form. These documentations ensure that you have proof that you completed and mailed the form.
  • Confirm that they have received your form once the letter is likely to have been delivered. This call is mostly to keep your policy surrender towards the top of your agent’s to-do list but can also save some time if something went wrong in the mail and they didn’t receive your form.
  • Wait and collect. At this point, there shouldn’t be anything else required of you except for receiving and depositing a check. In some cases, your insurance company may be able to make direct deposits instead.


All life insurance policies can be surrendered, but only certain ones will come with a cash value. Whole life and universal life policies have investment components that are paid out upon completion or surrender of the plan. Before surrendering any policy, think about what other life insurance options you need to have in place, and consider all fees and other implications prior to initiating the process.

Also read: 

Waiver Of Premium Rider: Everything You Need To Know

How to Customize Your Life Insurance Plan with Riders?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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