The cash surrender value of a life insurance policy can decrease due to several factors. Here are some possible reasons:
1. Policy Loans: If you have taken out a loan against your life insurance policy, the cash surrender value will decrease by the amount of the loan plus any interest charged.
2. Policy Surrender: If you decide to surrender your life insurance policy, the cash surrender value will be paid out to you. This will result in a decrease in the cash surrender value.
3. Policy Lapses: If you stop paying premiums on your life insurance policy and it lapses, the cash surrender value will decrease to zero.
4. Policy Charges: Some life insurance policies have charges deducted from the cash surrender value, such as administrative fees or mortality charges.
5. Investment Performance: The cash surrender value of certain types of life insurance policies, such as variable life insurance, may be tied to the performance of underlying investments. If the investments perform poorly, the cash surrender value can decrease.
It's important to review your life insurance policy documents and speak with your insurance provider to understand the specific factors that may be affecting the cash surrender value of your policy. They will be able to provide you with more detailed information based on your individual policy and circumstances.