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Based in Atlanta, Georgia, Eugene E. Houchins III is an accomplished insurance expert with an engineering background. Eugene E. Houchins III is president of the American Life Fund Corporation, which focuses on life insurance liquidation. In this role, he helps life insurance policy holders who have serious illnesses to access finances for medical expenses.
When a policyholder liquidates a whole life insurance policy, they receive a cash surrender value--the funds that are paid out if a policy is terminated before its official maturity date. Cash surrender value is calculated based on the amount of savings that have been invested into a life insurance policy. The longer a policyholder has contributed to the policy, the higher cash surrender value. Additionally, the amount of dividends, interest, and capital gains that have been earned by the policy also determine its cash surrender value.
Loans and taxes can impact the cash surrender value of a whole life insurance policy: In some instances, policyholders can use the cash value of their policy as collateral for taking out loans. If loans remain unpaid when the policy is liquidated, the outstanding loan principal and interest are deducted from the policy’s cash surrender value. Tax issues can also arise, as any dividends paid into the policy are taxable when the policy is surrendered.
