When To Surrender Life Insurance? 
Why would you want to `` surrender life insurance '' . I am assuming that your life insurance policy is an individual policy that you purchased years ago and has `` cash value '' . It has nothing to do with a `` retirement plan '' so the IRS has no control over the policy as they do with a `` retirement plan '' . There are many things you can do with the life insurance policy to make it continue to not only provide a `` death benefit '' but you can also use it to generate additional sources of income , you could change the beneficiary to your children therefore the death benefits would pass to them by `` contract law '' and you can even use it to provide a source of `` non-taxable long term care benefits by converting it to a Private Pension Act qualified plan . While you can certainly surrender the policy and pay the tax consequences when you do I hope you realize their are many ways you can continue to make that policy help you to reach financial goals . 