No you do not put anything on line 3.
If you cashed out the policy then the issuer should have figured the box 2a taxable amount and subtracted your cost basis and premiums form the box 1 amount.
https://www.irs.gov/faqs/interest-dividends-other-types-of-income/life-insurance-disability-insuranc...
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
