Why is the cash value of my life insurance policy much less than the total premiums paid?
Cash value or cash surrender value of a whole life insurance policy is the amount of money the policyowner will receive as a refund if the policyowner cancels the insurance and surrenders the policy to the company before the policy matures. The amount of cash value depends on the face amount of the policy, the length of time the policy has been in force, and the length of the policy’s premium payment period. The cash value will increase throughout the life of the policy and will eventually equal the face amount of the policy, but usually not until the insured reaches the age at the end of the mortality table used to calculate premiums for the policy, usually age 100.
