How Much Is A Life Insurance Policy Worth? 
There are two key values to a life insurance policy : its death benefit and its cash value . The death benefit is the amount the policy pays as a lump sum -LRB- generally income tax free -RRB- when the life insured dies . The cash value is what the policy is `` worth '' to the owner during life . Term life insurance has no cash value while permanent policies are a current asset . The cash value of a policy can be accessed during life if necessary through withdrawing some of the money as cash or taking a policy loan . Or , the policy could be canceled for the cash surrender value - the total value of the asset . At this point , the death benefit amount is canceled . 