Face of policy refers to the amount of coverage the insured pays for in an insurance policy. Because this figure is often included on the policy's top sheet or face, it is often referred to as the policy's face value. In terms of life insurance, it refers to the amount the policyholder would receive upon the insured's death or the death benefit.
It is important to note that the face value of a life insurance policy is different from the cash value. Cash value is the value of the savings and investments that have built up over time with permanent policies. It is subject to fluctuations in the market and how well the investments perform; however, the face of policy never changes. That means beneficiaries would receive the face amount or death benefit, even if the investments did not do well and signficantly reduce the cash value.
Share this Term
Stay informed with Insuranceopedia!
The world of insurance can be complicated. Subscribe to the Insuranceopedia newsletter and stay in the know! Access expert content, industry term definitions and answers to your questions from knowledgeable insurance insiders. Arm yourself with what you need to know to keep your assets and your family safe.
Latest Articles
