Death Benefit

the amount of money that the insurance company must pay if the insured dies while the policy is in force, usually calculated after deduction of any fees due to the insurance company for the most recent month and deduction of any loans that the policy owner has taken out from the policy’s cash value. With some policies, often called Option B Policies, the Death Benefit includes not only the Face Amount of the policy but also its Accumulated Cash Value (minus any loans taken by the policy owner against the policy’s Cash Value). With other policies, often called Option A Policies, the Accumulated Cash Value is not part of the Death Benefit.