Why the difference in Premiums paid vs Cash Value? (Whole Life)

[Jason Rose]

I'm trying to find out information for my mother regarding a Whole Life Insurance policy she has.

She started this policy roughly 10 years ago (I had no idea this whole time) and is in her early 70's. As her English is not the greatest either, the possibility that she may have been taken advantage of sits in the back of my mind.

I took a look at her account today and saw that she's been paying her premiums monthly, for the past 10 years.

But the Cash Value amount of the Whole Life Insurance policy does not match the Premiums she has been paying. The Cash Value amount is roughly $2,000 less than the total Premium amounts she has paid (i.e.: Cash Value of $27,000 and Total monthly premiums paid for 10 years = $25,000).

Where is this gap coming from? Just a note, I'm not too familiar with Life Insurance as well so I'm trying to help my mother out.

Also is it the policy of Insurance companies to mail out the Notice of Anniversary date on the exact Anniversary date? She wanted to change her policy but was told that she had to have done it before the anniversary date or wait until the next anniversary date. Well, she couldn't exactly do that as she didn't receive the letter until 5 days after her policy anniversary date.

Thanks in advance.