Anonymous asked in Business & FinanceInsurance · 4 months ago

Which of the following statements about insurance and annuities is incorrect?

The cash surrender value of a life insurance policy is the amount payable by the insurance company to the beneficiary.

The beneficiary of a life insurance policy is the person who receives the proceeds of the policy after the insured’s death.

Term insurance does not have cash value.

Annuities are contracts that pay income to someone during their lifetime.

2 Answers

  • martin
    Lv 7
    4 months ago
    Favourite answer

    First statement is incorrect. Cash surrender value belongs to the policy owner who usually is the insured in a whole life policy.

  • 4 months ago

    The first one is wrong. The beneficiary received that face value/death benefit of the Life Insurance policy upon death of the insured. (minus money that may have been borrowed against the policy {and any fees} if it was a whole life policy)

    As the other person said the Cash Surrender Value is what is given to the owner of a whole life or indexed universal life insurance policy if they cancel their policy. It is money that has been built up in the market from your premium payments. You can use this money but as I mentioned before, if you do take the money out of a whole life policy you would want to pay that money back if you don't want the full value of the insurance policy to decrease.

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