This article deals with the least comfortable question about the product, because honesty requires saying it plainly: with a significant share of funeral expense policies, cancelling brings no payout. Let's look at exactly when, and why.
- Many funeral expense products are pure risk cover: they have no surrender value – this is not a flaw, but the price of the lower premium.
- There are exceptions in the market: some products carry a partial surrender value after a few years.
- Within 30 days of being notified that the contract has come into effect, you may terminate a life insurance policy (with a term of over six months) without giving reasons, under the Insurance Act; for distance-sold contracts (concluded by phone or online), under the distance-selling act in force from 19 June 2026, you are also entitled to terminate the contract within 14 days of concluding it, without giving reasons and with immediate effect – the insurer settles the premiums paid according to the terms.
Why do many products have no surrender value?
Because the premium goes purely toward covering the risk: the insurer builds no savings reserve within the policy, so there is nothing to hand back. In exchange, the premium can be lower than with a structure that also builds a reserve. If you are looking for the flexibility of "I can take my money out any time," this is not the right product for you – our comparison with savings products addresses this honestly.
Where are the exceptions?
Some funeral expense products in the market do build a premium reserve: after a few years of premiums paid, these carry a partial surrender value – typically a set share of the accumulated reserve, according to a schedule. Some also allow one-off additional payments, and the value of these tends to be more flexibly accessible. On surrender, part of any surplus credits typically may be lost – the details vary by product, and I show them in the comparison.
What you get instead: paid-up reduction
For products with no surrender value, in some cases paid-up reduction can be chosen instead of cancelling – though this assumes a structure that builds a reserve; for a pure risk product with no reserve, this option is typically not available either. It is worth going through this too, product by product, before you sign. The conditions – how much time and how much premium paid are needed – vary by product.
The 30-day right of termination, and ordinary cancellation
Within 30 days of receiving notice that the contract has come into effect, the contract may be terminated without giving reasons – in that case, the premium paid is typically refunded, at some insurers after a set deduction, elsewhere in full. After that, ordinary cancellation is possible under the terms: for a product with no surrender value, with no payout. That is why, before signing, it is worth working through the question of whether the premium is affordable in the long run – the article on premium and sum insured helps with this.
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