Canceling Manulife Life Insurance: A Step-By-Step Guide

If you're looking to cancel your Manulife life insurance policy, there are a few steps you need to take. Firstly, it's important to understand the difference between term life insurance and whole life insurance. With term life insurance, you can simply stop making payments and your coverage will end, whereas cancelling a whole life policy is a more complex process that requires communication with Manulife. Manulife offers a free look period of 30 days, during which you can cancel your policy and receive a full refund of your premiums. After this period, you can still cancel at any time by mailing a signed, written notification to Manulife, but there may be financial implications, such as taxes on the interest earned from the policy's cash value.

Cancelling during the free look period

Life insurance policies typically have a free look period of 10 to 30 days after your policy goes into effect. During this time, if you decide that you no longer want the policy, you can cancel without penalty. Manulife offers a 30-day free look period, during which you can return your Policy or Certificate of Insurance and request that your coverage be cancelled. Your premiums will be refunded in full, with no questions asked.

To cancel during the free look period, carefully examine your Policy or Certificate of Insurance as soon as you receive it. If you are not completely satisfied, simply return it to Manulife within 30 days, along with a written and signed cancellation request. Your premiums will be refunded, but keep in mind that if you choose to rejoin the plan in the future, you will need to complete a new application and meet the medical qualifications required of any new applicant.

If you are unsure about cancelling your coverage, Manulife encourages you to contact their customer service representatives for assistance. They are available Monday through Friday from 8 a.m. to 8 p.m. ET, and can be reached by phone at 1-888-913-6333 or by email at [email protected].

Cancelling after the surrender period

Cancelling a whole life insurance policy involves a few more steps than cancelling a term life insurance policy. If you have a whole life insurance policy and want to cancel it after the surrender period, you will need to contact your insurance company. Your options will depend on how long you've owned the policy and your insurance company's guidelines. Here are some common outcomes:

Reduced Paid-Up Insurance

This option comes with the fewest fees. A reduced paid-up option allows you to stop paying premiums in exchange for a lower death benefit. The reduced payout is based on the premiums you've already paid, and coverage lasts for life. Even though the coverage amount is much smaller, a reduced paid-up option doesn't come with penalties and still maintains some amount of insurance protection.

Exchange for Another Policy or Annuity

You may be able to exchange your insurance policy for another life insurance policy or an annuity. This option allows you to transfer any investment gains to the new policy without paying taxes on them at the time of the exchange. This process is known as a 1035 exchange.

Sell Your Policy

You can sell your life insurance policy using a life settlement company. You'll have to pay commissions and fees for the service, so depending on the value of your policy, you may not walk away with much money. On the other hand, if you make a profit on your policy, the payout you receive is subject to income tax. This process doesn't usually make financial sense, so it's best to consult a trusted financial advisor if you're considering selling your policy.

Cancelling a Permanent Life Insurance Policy

When it comes to cancelling a permanent life insurance policy, the process can be more complex than with a term policy due to additional elements involved. Permanent life insurance policies are designed to provide lifelong coverage, with maximum coverage ages ranging from 95 to 121, and typically include a cash value component. Because of this, cancelling or "surrendering" these policies can involve more than just stopping payments.

When you surrender a permanent life insurance policy, you may receive a payout from the cash value, but this is often reduced by surrender charges, especially if you haven't held the policy for many years. Surrender fees can significantly reduce or even eliminate the cash value you receive in the early years of the policy. Over time, these fees decrease, but it's important to understand that the cash value may not be as substantial as expected if you surrender the policy prematurely.

If you have any outstanding policy loans, your surrender value will also be reduced by the balance (any unpaid loan plus accrued interest). Additionally, if you made any withdrawals, this permanently reduced the available cash surrender value. Cancelling a permanent life insurance policy is a significant decision with potential financial implications, so it's crucial to fully understand the consequences before proceeding.

Contacting Manulife via phone or email

To cancel your Manulife life insurance policy, you can contact Manulife via phone or email.

Contacting Manulife via Phone

Manulife's customer service representatives are available Monday through Friday from 8 a.m. to 8 p.m. ET. You can call them toll-free at 1-888-913-6333. If you have questions about Health and Dental, you can also call 1-800-268-3763 Monday through Friday from 8:00 a.m. to 8:00 p.m. EST.

Contacting Manulife via Email

You can email Manulife at [email protected]. Do not include any credit card account numbers in your email message. If you have questions about Health and Dental, you can also email them at [email protected].

Cancelling Your Manulife Life Insurance Policy

To cancel your Manulife life insurance policy, simply mail a written notification bearing your signature. Your coverage will end starting from the payment due date following the date they receive your cancellation request. If you return your Policy or Certificate of Insurance within 30 days of receiving it, along with your written and signed cancellation request, Manulife will refund your premiums in full.

If you are unsure about cancelling your coverage, you can contact Manulife and they will try to help.

Filling out the Policy Surrender form

To cancel your Manulife life insurance policy, you will need to fill out and submit the Policy Surrender form. Here is a step-by-step guide on how to fill out the form:

Step 1: Access the Policy Surrender Form

You can find the Policy Surrender form on the Manulife website or by contacting Manulife directly and requesting the form.

Step 2: Complete the Form

Provide all the requested information in the form, including your personal details such as name, contact information, policy number, and any other relevant information. Make sure to read the form carefully and fill it out accurately.

Step 3: Sign the Form

The form will need to be signed by the policyowner or assignee. Please note that for trust policies, the signature requirements may differ. Refer to the form or contact Manulife for more information.

Step 4: Submit the Form

Once you have completed and signed the Policy Surrender form, you can submit it to Manulife. The form can be submitted through various channels, including mail, fax, or secure upload to the Manulife customer portal (if available in your region). Please refer to the form or the Manulife website for specific submission instructions.

Step 5: Include Supporting Documents

Along with the completed form, you may need to provide supporting documents. These could include identification, proof of ownership, or other relevant documentation. Check the form or with Manulife directly to understand the specific requirements for your situation.

Step 6: Understand the Consequences

Before submitting the Policy Surrender form, make sure you are aware of the consequences of cancelling your life insurance policy. Cancelling your policy may result in losing valuable benefits and coverage, impacting your long-term financial goals, and potentially affecting your ability to obtain similar protection in the future. Additionally, there may be tax implications on the cash value of your policy. Contact Manulife at 1-888-626-8543 for a taxable gain quote and further guidance.

Please note that the above instructions provide a general guide, and the specific process may vary depending on your location and the type of policy you hold. Always refer to the official Manulife sources and your specific policy documents for the most accurate and up-to-date information.

Surrender fees and taxable gains

Surrendering your Manulife life insurance policy may come with tax consequences. The Internal Revenue Service (IRS) considers the surrender of a life insurance policy a taxable event if the surrender value is more than the premiums you've paid.

The taxable amount is the difference between the cash surrender value minus the total premiums paid. For example, if you have paid $50,000 in premiums and the cash surrender value is $70,000, the taxable gain when surrendering your policy would be $20,000. The percentage you'll owe in taxes depends on your current tax bracket.

Surrender fees are extra charges that the insurance company deducts from your cash value if you surrender the policy before a specified number of years, usually around ten. Surrender fees typically start at 10% in Year 1 and then reduce by 1% each year until they drop to 0% in Year 10.

In the case of Manulife life insurance, you can cancel your policy by completing and mailing the Policy Surrender form. However, keep in mind that your cash value may be taxed as income. It is recommended to call Manulife at 1-888-626-8543 for a taxable gain quote before surrendering your policy.

It is important to consult with a tax advisor or financial advisor to understand the specific tax implications and explore ideas to minimize the tax burden. They can provide guidance on reporting requirements and help you make informed decisions regarding your life insurance policy.

Frequently asked questions