what does cash value mean on a life insurance policy.
cash value. Definition. The amount available in cash upon cancellation of an insurance policy, usually a whole life policy, before it becomes payable upon death or maturity. also called cash surrender value or surrender value. Use cash value in a sentence. â 1  The cash value of the policy was substantial so we decided to cancel the policy and receive the infusion of liquidity. â 2  I noticed that I had a lot of cash value and that was good because I needed it badly and could not afford insurance anymore.