Home Life insurance Life insurance questions what happens to cash value in whole life policy at death what happens to cash value in whole life policy at death By Insure.com | Posted on January 28, 2011 Why you should trust Insure.com Quality Verified At Insure.com, we are committed to providing honest and reliable information so that you can make the best financial decisions for you and your family. All of our content is written and reviewed by industry professionals and insurance experts. We maintain strict editorial independence from insurance companies to maintain editorial integrity, so our recommendations are unbiased and are based on a comprehensive list of criteria. No, your beneficiary receives only the face value of the policy; however, there are limited exceptions. For example, some insurers offer a rider that gives your beneficiary the face value plus cash value. But, if you did have this option, you’d likely know about it because you’d be paying extra for it. Check your policy to be sure, or call your insurance agent.Whole life is a type of permanent life insurance, which, as you know, includes a cash account that gradually grows in value over time. Term life covers the policyholder for a certain period, such as 10, 15 or 20 years, but does not feature a cash account.You can borrow against the cash value in your whole life insurance policy, or even withdraw it. But if you don’t repay the loan, plus interest, the death benefit of the policy will be reduced—the extent of that reduction depends on the policy. In traditional whole life policies, the death benefit can be reduced by more than the amount of cash you withdraw.Once the cash value has reached a certain level, you can use it to pay premiums to keep the policy in force. This is known as being “paid up.”Cash value is an attractive feature, but unless you have a special rider on the policy, it’s for the benefit of the policy owner, not the beneficiary.For more, see cash value in life insurance: What’s it worth to you? × Get Free Life Insurance Quotes Today! Zip Code Please enter valid zip Age Age 16 – 20 21 – 24 25 – 34 35 – 44 45 – 54 55 – 64 65+ Coverage Amount Coverage Amount $50,000 – $100,000 $100,000 – $200,000 $200,000 – $300,000 $400,000 – $500,000 $500,000 – $1,000,000 $1,000,000 – $2,000,000 $2,000,000 – $5,000,000 $5,000,000+ Coverage Type Coverage Type Whole Life Term Life Final Expense Not Sure Gender Gender Male Female Non-Binary Tobacco Use Yes No Compare Quotes QuickTake What is demutualization and what does it mean for policyholders? How life insurance works during a divorce Can you change the coverage of your term life insurance? Can you cash in a paid up life insurance policy? Can I withdraw money from my life insurance policy? How can I get life insurance if I'm in poor health? Are you too old to buy affordable life insurance? Do life insurance policies pay out if you die of old age? Can relatives steal your life insurance money? Can someone take out a secret life insurance policy on you? Protect yourself from insurance revenge during divorce Can I take out a life insurance policy on my spouse? What to do if your life insurance policy lapses How to find lost life insurance policies Can I withdraw money from my term life insurance? How to forfeit life insurance proceeds? How do wills work with life insurance? Frequently asked life insurance questions Life Insurance: Waiver of premium is it worth paying how to find a lost life insurance policy of my relative? how to find a lost life insurance policy of my father? Would an accidental death policy pay for a cocaine overdose? Is the life insurance payout I received taxable? will life insurance pay if drunk driving can you cash in a life insurance policy Burial Insurance for Funerals Expenses Basics of term life insurance policy Can I find life insurance policies of deceased mother Can I find life insurance policies of deceased dad Would an AD&D claim be denied due to accidental overdose Can an ex-spouse collect life insurance money? What is API financial rating of life insurance companies Can a beneficiary take out a loan on a life insurance policy? Questions to ask when found the lost life insurance How long must I wait to get nonsmoker life insurance rates? Can a life insurance beneficiary change on deathbed? how to find a lost life insurance policy How long do you have to be a non smoker for life insurance? See more > Related Articles Can you change the coverage of your term life insurance? By Insure .com Can you cash in a paid up life insurance policy? By Les Masterson Can you cash in a life insurance policy to pay off debt? By Barbara Marquand Can I withdraw money from my life insurance policy? By Desiree Ghazi How can I get life insurance if I’m in poor health? By Desiree Ghazi Do life insurance policies pay out if you die of old age? By Desiree Ghazi Get instant quotes now ! Please enter valid zip Get Quotes