Surrender Value Calculator

Formula

The formula to calculate the surrender value (SV) is:

\[ SV = TPP \times (1 - \frac{SC}{100}) \]

Where:

$SV$ is the surrender value ($)
$TPP$ is the total premiums paid ($)
$SC$ is the surrender charge (%)

What is a Surrender Value?

Surrender value is the amount that the policyholder will receive from the insurance company if they decide to terminate the policy before it matures or before the insured event occurs. This value is typically less than the total premiums paid due to surrender charges that the company applies for early termination of the policy.

Example Calculation

Let's assume the following values:

Total Premiums Paid (TPP) = $10,000
Surrender Charge (SC) = 5%

Using the formula:

\[ SV = 10,000 \times (1 - \frac{5}{100}) = 10,000 \times 0.95 = 9,500 \, \text{dollars} \]

The Surrender Value is $9,500.