What can the policy owner do with the cash surrender value in a permanent life insurance policy?

The cash surrender value of a permanent life insurance policy is the amount of money an insurance company pays to the policyholder if the policy is canceled. This value accumulates over time as the policyholder pays premiums, and it represents a portion of the policy’s savings component.

When a policyholder chooses to access the cash surrender value, they can typically do so without incurring a penalty in the sense of a withdrawal fee, although it's important to note that taking the cash surrender value usually means the policy will be terminated. This is a key benefit of permanent life insurance, as it allows the policyholder to tap into the funds they have built up over time.

Accessing this value might come with tax implications if it exceeds the amount of premiums paid, but physically accessing the funds directly is generally straightforward. The option that involves accessing it without penalty reflects this ease of access, emphasizing the policyholder's ability to utilize this value as they see fit.

The other options involve scenarios that do not accurately represent the nature of cash surrender value or the effects of accessing it in a permanent policy context. For example, forfeiting all policy benefits would occur if the policyholder chooses to surrender the policy, but accessing the cash does not provide ongoing benefits. Investing in other