Which term describes the action of surrendering a cash value policy to receive its surrender value?

Which term describes the action of surrendering a cash value policy to receive its surrender value?

• A. Mortality Table
• B. Spouse Rider
• C. Surrenders
• D. Health Savings Account (HSA)

Answer: (C)

In a cash-value life policy, the owner can terminate the policy and take out the policy’s cash value. That act is called surrendering the policy, and the amount you receive is the surrender value. The option that matches this idea is Surrenders, since it describes the action of giving up the policy to get its cash value. The other terms don’t fit: a Mortality Table relates to estimating death probabilities for pricing, a Spouse Rider is a type of add-on coverage, and a Health Savings Account is a separate medical expense savings vehicle. When you surrender, the policy ends, and the payout may be reduced by surrender charges or any outstanding loan, with potential tax implications if the cash value exceeds the amounts paid in.

In a cash-value life policy, the owner can terminate the policy and take out the policy’s cash value. That act is called surrendering the policy, and the amount you receive is the surrender value. The option that matches this idea is Surrenders, since it describes the action of giving up the policy to get its cash value. The other terms don’t fit: a Mortality Table relates to estimating death probabilities for pricing, a Spouse Rider is a type of add-on coverage, and a Health Savings Account is a separate medical expense savings vehicle. When you surrender, the policy ends, and the payout may be reduced by surrender charges or any outstanding loan, with potential tax implications if the cash value exceeds the amounts paid in.