What Happens If I Cancel Whole Life Insurance? 
You most definitely can cancel your whole life insurance . Cancelling it would result in you longer having life insurance coverage under that policy , but will not affect coverage under any other separate policy . With whole life , you could have accumulated equity in your policy . With cancellation , you will receive the cash surrender value of that policy . Those funds would be taxable . You could instead have borrowed against the policy , kept the policy in force , with a death benefit -LRB- reduced by the amount of the loan -RRB- and kept the borrowed funds tax free , never having to pay them back if you did not want to . Should you later pay back the loan , the death benefit would return to where it had earlier been and no longer be reduced by the loan amount . Thank you . GARY LANE 