cash surrender value

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Cash surrender value is the amount of money, or cash value, of an insurance contract when the contract is surrendered and given up by the insured back to the insurer. The policyholder effectively surrenders the insurance policy to obtain the cash surrender value. The cash surrender value is essentially the refund of the accumulated reserve and is calculated by subtracting the cost of insuring the policyholder from the excess level of premiums that have been paid by the policyholder. There is sometimes a surrender charge (charge for giving up the insurance policy) that is subtracted as well. 

[Last updated in June of 2021 by the Wex Definitions Team