How Much Can You Borrow Against Life Insurance? 
When borrowing from a life insurance policy , you 're borrowing monies from its cash value - this is only available on permanent programs -LRB- cash value does n't build inside term insurance policies -RRB- . You can only borrow up to the amount available in the cash value - this figure typically goes up over time . Review your annual statement or call your agent/the carrier to find out the current cash value available inside the policy . Keep in mind , when you borrow from your policy 's cash value , you are in effect creating a loan because you are expected to pay back the borrowed amount - and with any loan , there is an interest rate attached . The longer it 's kept out , the more interest that is charged . If the insured dies with an outstanding loan against the policy , the loan amount plus any interest is subtracted from the death benefit and the difference is given to the beneficiary . 