The cash surrender value of the life insurance policy is an asset that is recorded on the balance sheet (B/S) of the company.
Is cash surrender value of the insurance policy is an asset?
From an accounting perspective, because the cash surrender value of a life insurance policy represents an asset you can control, accounting standards recognize it as an asset on the balance sheet.
How do you record cash surrender value?
Simply put, most permanent life insurance policies have the ability to build cash value over time. As a result, the accumulated cash value can be considered an asset when calculating one's net worth. The primary purpose of life insurance is to provide financial support to your loved ones upon your death.