Surrender

What Does Surrender Mean?

Surrender refers to the process by which a policyholder officially cancels their insurance policy. This is typically done by notifying the insurance company and signing documents that forfeit the individual’s entitlement to future benefits.

Insuranceopedia Explains Surrender

When someone wishes to cancel their policy, they contact their insurer to initiate the process. They may be sent a surrender form to complete and return to the company. If no surrender form is provided, the policyholder can write a letter requesting the cancellation of the policy. In many cases, the insurer will ask the policyholder to provide a bank account number so they can deposit the policy’s cash value before its maturity.

Over time, a policy accumulates cash value, which is one reason some individuals choose to cancel their policy. For example, they may face a financial issue that can be resolved by surrendering the policy and converting its value into cash.