Accumulated Value

Accumulated value pertains to whole life or cash-value life insurance. It includes the accumulated amount of the policy’s cash value—capital investment plus earned interest or appreciation in value based on whatever stocks and bonds and others that the insurance company has invested in. When policy subscribers pay the premium on a cash-value life insurance policy, part of their hard-earned money pays for the life insurance portion—the part of the policy you don’t want to use. At least not for a while.

The other part of your hard-earned money goes to the cash-value portion of the policy—what you get when you decide not to die. If you cash in the policy early, the amount of cash you get will be less than the accumulated value, if there is an early cash-out penalty. And chances are...there’s an early cash-out penalty.