Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Benjamin Carr was a licensed insurance agent in Georgia and has two years' experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.

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Reviewed by Benji Carr
Former Licensed Life Insurance Agent Benji Carr

UPDATED: Sep 16, 2021

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The Facts of Life

  • You can cash out a life insurance policy for any reason
  • Finding a life insurance company that produces strong dividends can increase your policy’s cash value
  • Loans taken from your insurance policy are not taxed but do impact your death benefit if you don’t pay it back

Life insurance is a great tool that can provide you and your family with some financial assistance if you were to pass away, but did you know that life insurance with cash-out options allows you to benefit from your policy while you’re still alive?

You can use your life insurance policy to fund any number of enterprises when you purchase life insurance that you can cash out.

Such insurance policies are very popular so you won’t have any trouble finding life insurance quotes online from affordable life insurance companies that allow you to cash out.

Start comparing life insurance quotes from life insurance companies that allow you to cash out right away. Enter your ZIP code above to get free quotes from life insurance companies that allow you to cash out today.

What are the best life insurance companies that allow you to cash out your policy?

When it comes to life insurance companies that build up an impressive amount of cash value and allow you to cash out your policy, you’ll be spoiled for choice.

Here is a list of some of the best life insurance companies that allow you to cash out:

  • New York Life
  • MassMutual
  • Penn Mutual
  • Guardian Life Insurance Company of America
  • Northwestern Mutual
  • American United Life Insurance Company
  • Foresters

If you want to buy life insurance that builds cash value, you should look into policies that produce dividends and allow for investment opportunities, like whole, variable, and universal life insurance policies.

With these types of policies, you can access that cash value while you’re still alive. If you’d rather not build capital through life insurance, you can purchase temporary life insurance policies from life insurance companies that don’t allow you to cash out.

That being said, life insurance companies that do allow you to cash out each have their own selling points. All of the companies listed above provide top-quality products, but do your due diligence and compare each one of them so you can be certain that you’ve picked the best company for you.

New York Life

New York Life has an A.M Best rating of A++  and offers a wide range of whole life insurance products. New York Life, founded in 1845, has a long history of providing its clients not only with excellent coverage but with strong dividend growth as well.

With a policy from New York Life, you can rest assured that you’ll not only be able to provide for your loved ones after your passing, but you can benefit from it while you’re alive as well.

The company advertises that $250,000 in coverage can be had for as little as $15 per month, but you should always request multiple life insurance quotes online to see how much an insurance policy created for you will cost.


MassMutual has an A.M. Best rating of A++, and its most popular product is whole life insurance. This company provides some of the highest average whole life dividends and is rather unique in that it offers both non-direct recognition and direct recognition policies.

A direct recognition whole life insurance policy tends to stall the growth of dividends. This is because the insurance company uses the cash value as collateral for loans. As such, a direct recognition policy could provide a smaller amount of cash value than a policy from a non-direct recognition company.

Applicants for a policy with MassMutual could potentially get $250,000 in coverage for only $11 per month.

Penn Mutual

Penn Mutual is one of the best life insurance companies in the business with an A.M. Best rating of A+ and policies that provide some of the highest dividends for its clients. Now, Penn Mutual does stand apart from other insurance companies as it is a strong supporter of collegiate rugby.

Penn Mutual is a sponsor of National Collegiate Rugby (NCR) which means that if you’re a rugby fan or someone who simply wants to work with a life insurance company that can provide you with a policy that offers great living benefits, Penn Mutual could be a great fit for you.

But how much does a policy with Penn Mutual cost? Unfortunately, this company has not yet shared its pricing mechanism with the public so must request life insurance quotes from Penn Mutual directly.

Guardian Life Insurance Company of America

If you’re looking for stability in these wild times, The Guardian Life Insurance Company of America is nothing if not reliable and has an A++ rating from A.M. Best.

The Guardian Life Insurance Company of America also has a variety of life insurance products, a sound history, and solid dividends.

Like Penn Mutual, discovering estimates for policy pricing with this company is not possible unless you request free quotes from the company directly.

Northwestern Mutual

If you want a whole life insurance policy that offers a strong cash value you can take advantage of, Northwestern Mutual is an excellent choice. The company holds an A++ rating with A.M. Best.

Northwestern Mutual is one of the first original mutual companies. That means that it is an insurance company that is in the possession of its policyholders, and applicants have the potential to obtain $500,000 in coverage for about $25 per month.

Some of these policyholders actually benefit from the company’s annual dividends as well. In fact, it’s expected that Northwestern Mutual will pay $6.2 billion in 2021, which will be the highest payout in the company’s history.

American United Life Insurance Company

While it may not be as well known as its competitors, American United Life Insurance Company has an A+ from A.M. Best and provides excellent policies, some of which include a long-term care benefit.

This benefit provides coverage for the costs of services like nursing-home care, health care at home, and personal care for individuals age 65 or older. This type of benefit can also be utilized by those with a chronic illness or disability that requires constant assistance.

With coverage from American United Life Insurance, you can not only cash out your policy to increase your cash flow but also use your life insurance to help you as you get older.

Working with American United is incredibly convenient as well as you can keep an eye on your policy via the company’s website. You will also need to request a quote via the website or over the phone to get an estimate of the cost associated with a policy because American United quotes are not available to the public.


Foresters is another company that offers very high participating dividends but is still relatively unknown despite having an A rating from A.M. Best.

Now, if you’re interested in doing business with a company that gives back you may very well want to do business with Foresters as it is a fraternal organization. According to the NAIC, fraternal organizations must be not-for-profit and offer life, health, and related insurance products to their members.

These organizations are also obliged to conduct charitable acts and pursue other works that would be of benefit to the public. One such benefit is that applicants have a chance of getting $250,000 in coverage for only $11 per month.

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Can you cash out a life insurance policy?

Typically, the owner of a life insurance policy pays a monthly or yearly premium in exchange for a large financial benefit to be bestowed upon their named beneficiaries at the time of their death.

However, if you were to cash out life insurance, that means you are taking out the funds that have grown in your policy’s cash value while you’re still alive.

If you need to, you can cash out your policy in a variety of ways:

  • Withdrawals
  • Loans
  • Selling the policy

You can even surrender a life insurance policy for cash value. While all of these strategies allow you to cash out your policy, one of the most common ways to do so is to use a loan as taxes do not need to be paid on this type of loan.

When you taking a loan out on your life insurance policy you won’t have to pay it back into the policy if you don’t want to. Of course, you should know that if you take out a loan and don’t pay it back, it will be taken out of your total death benefit.

How to Find the Top Life Insurance Companies That Allow You to Cash Out

A life insurance policy can be an excellent financial tool, even if life insurance rates for life insurance companies that allow you to cash out tend to be higher.

If you choose to buy life insurance that allows you to cash out, you can use your policy if you’re in a pickle financially or if you would like to take out a loan that you won’t have to pay back. Just remember that whatever you take out of your policy while you’re alive will affect your death benefit.

Ready to buy life insurance? Enter your ZIP code to get free quotes from life insurance companies that allow you to cash out near you.