What happens when your term life insurance expires?

If your term life policy expires while you're still alive, your insurance company will notify you that your coverage has ended, and you no longer need to pay your premium. If you still need coverage, it may be possible to renew your policy for a set period of time. You might also be able to convert it to a permanent life insurance policy instead if you have the right rider. Lastly, you could buy another term life policy, but your premiums would likely be much higher than your original policy.

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What to do when your term life insurance is expiring

If you no longer need your term life policy, then you typically don't have to do anything. You can just let your coverage lapse. But if you still need coverage, you should review your life insurance options before your current policy expires. Your options may include:

Renewing your term life policy

How it works: Many term life insurance policies include a guaranteed renewability clause that will let you extend your coverage past its expiration date on a year-to-year basis. Your death benefit stays the same, and you won't have to reapply or undergo another life insurance medical exam. However, your premium is likely to increase each year you renew.

When it makes sense: If you just need coverage for a few extra years, then this could be a viable option for you. For example, if you were diagnosed with a terminal illness, and unlikely to be eligible for a new policy, you could renew your term policy for a few years to ensure your beneficiaries would receive a death benefit.

If you need coverage for longer than a year or two, then you should consider other options to avoid paying a premium that rises every year.

Converting from term to permanent

How it works: If your policy has a conversion provision or term conversion rider, then you can convert your term life policy to a permanent, whole life insurance policy that will last the rest of your life. Most term life policies include a conversion provision, but you should check your policy or contact your insurance company to confirm you have this option. Learn more about switching from term to whole life insurance.

When it makes sense: If you've had a change in health, still have dependents, or have more debt than you anticipated at the end of your term policy, then switching over to a whole life policy might be right for you. Doing so will give you coverage for the rest of your life. It may also be cheaper than buying a brand-new life insurance policy if your insurer doesn't require a new medical exam.

Buying a new policy

How it works: You can buy a new life insurance policy from your current insurer or shop around for a new life insurance provider. Keep in mind that you'll need to go through the application process again, as well as get a new medical exam (unless you qualify for simplified issue life insurance).

When it makes sense: If you can't convert your term policy to a whole life policy, then buying brand-new insurance may be your best option. Generally, a new term policy will be cheaper than a new whole life policy, but either way, your premiums are likely to be higher compared to your old policy. This is because your new policy will be based on your current age and health status.

Important note: Many people choose to buy a second life insurance policy well in advance of their current one lapsing in order to avoid paying a higher premium.

How long does term life insurance last?

You can generally choose coverage lengths of 10, 20, or 30 years, though options vary by insurer. Your coverage will remain active throughout the term period you select, as long as you continue paying your insurance premium. Learn more about how life insurance works.

Can you extend a term life insurance policy?

If your term life policy includes a guaranteed renewability clause, then you can extend your existing coverage and death benefit — usually on a year-to-year basis. Another option would be to convert your term policy to a whole life policy, which you can do if your policy has a conversion provision or term conversion rider.

Do you get your money back at the end of a term life insurance policy?

You can't get your premium dollars back from a standard term life insurance policy once it expires. However, if you buy a return of premium (ROP) rider, then you could get some or all of your premium back if you outlive your policy. Learn more about return of premium life insurance riders.