How to Surrender a Prudential Life Insurance Contract

When you buy life insurance from Prudential, you receive a policy contract and annual statements from the company about your life insurance policy. Prudential sells term life insurance, variable life insurance and two types of universal life insurance. If you have a policy with Prudential you can surrender it. If you have a permanent policy, you'll want to maximize the amount of cash you receive from the policy.


Step 1

Stop paying the premiums on your term life insurance policy. If you stop paying the premiums for your term policy, the policy will be automatically surrendered. This option is suitable only for term life insurance.

Step 2

Gather all of your policy information for your permanent life insurance policy. This information includes your policy contract and policy number. You also need the most recent policy statement that shows how much cash value you have available in the policy.

Step 3

Get the surrender paperwork from the insurer. Prudential has forms for you to fill out so that you can receive the cash surrender value of the policy. You may take out a policy loan or withdraw funds from your policy by calling the company and requesting a policy loan or withdrawal. However, the company generally does not allow a full withdrawal or policy loan. Instead, a small portion of the cash value will remain in the policy unless you surrender the whole policy.


Step 4

Fill out the paperwork for the surrender of your policy. Include your name, address and Social Security number as well as your bank account information if you want the cash surrender value deposited into your bank account. You'll also need to include the policy number and the cash surrender value of the policy you are surrendering. Sign and date the form. Then mail the form back to the company. Verify that the company has received the form. It may take up to 30 days for the insurer to send the funds to you.


If your cash surrender value is in excess of the total premiums you've paid, you must report any gain on your tax returns in the year that you surrendered the policy. This gain is taxable as ordinary income.


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