Surrender Charge

A surrender charge is an amount of money that may be charged by a life insurance company when you cancel your life insurance policy. This type of fee generally is charged when an individual cancels a life insurance policy within a certain number of years after opening the policy. Not all life insurance companies will charge this fee, but many of them do. It is also referred to as a surrender fee by some companies. In some cases, you may be able to get out of paying the surrender charge if you provide plenty of notice to the insurance company.