How to get cash from a life insurance policy?

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How to get cash from a life insurance policy?

My mother-in-law has been paying on a life insurance policy for the past 30 years. Her finances have increased due to my father-in-law’s death and she can no longer afford the payments for the insurance. I called the life insurance company today to tell them she is unable to keep the insurance and would like to cash it in. They told me she will get nothing back. I have a hard time believing that over 30 years of payments gives her nothing? Is that even legal? I just need to know how to proceed further.

info.

Sincerely, Gina Stout

Asked on May 1, 2017 under Insurance Law, Florida

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

What type of policy is it? If it is a permanent type of policy such as whole life or universal life there may be some cash value to recover. If, however, it is a term insurance policy there is no value so there is nothing to "cash out". That having been said, some term policies have what's called a "return of premium" rider that, if held for the contract period, can return the premium outlay to the policy owner. Some owners sell their term life insurance policies during the conversion period to the life settlement market for cash based on their life expectancy.


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