If I am the beneficiary of a cash value life insurance policy and the owner of policy dies, can I cash out?
The policy was taken out by grandmother on my father (unknown whereabouts) and I was made the beneficiary. My grandmother passed away and the policy was given to me by my grandfather. It has been paid in full for over 10 years now. I would like to use it to pay for school. Please help.
No. Only the owner can cash out – you’d have to get ownership transferred to you. But if the owner is also the insured, then you’d get the FACE value, which is MORE than the cash value.
So, was ownership of the policy transferred to you? You’ll have to call the company and find out. Ownership does NOT transfer, with your grandfather handing the policy over to you. The policy has to be changed, at the company.
Suze Orman on Cash Value Life Insurance vs. Term Life Insurance
