Are you going to surrender your life insurance policy? Do you know that you have some options to fulfill your financial needs without surrendering your policy? If you don’t know what are other options available to you then you are at right place. In this post, we’ll show you some options that you can consider before withdrawing a policy. Practically, insurance policy surrender is not a good option because it is subject to penalties such as, surrender charges; therefore, one should seek other options before doing so. Probably, you may aware that on terminating a life insurance contract you only receive saving portion of your policy along with accrued bonuses.
Options to seek before insurance policy surrender
Life insurance policies with saving components come with partial withdrawal options. With partial withdrawal facility, policyholders can withdraw a portion of their cash values accumulated in saving portfolios say 25% or 30% (actual figure depends on your policy).
You may not be aware that you can take loan on your life insurance policy; therefore, we suggest you consider this option to fulfill your money requirements. Though taking loan on a life insurance policy is not advisable; however, you may opt this option when you require emergency funds. Usually, amount of loan that your can take depends on age of your policy.
Make Policy Paid-up
Note: You may need to pay the premiums until the lock-in period expires if you want to convert your policy into paid-up.