What to Do When Your Term Life Insurance Policy Ends


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Many of us enjoy the “fire and forget” approach to a term life insurance policy, but eventually, that term insurance contract will expire.

When this happens, it’s important to be proactive and not end up as one of the millions of Americans who don’t have any life insurance coverage in place.

If you’ve purchased term life insurance at a previous time but are unsure what to do when your term life insurance policy ends, then read on to find our advice.

Reassess your situation when you term life insurance policy ends

When your term life insurance policy ends, it’s time to take stock.

You could be ten or twenty years on from when you first took out your policy. What’s changed in that time?

  • Are you in worse health?
  • Do you have more dependents?
  • Can you provide for the family who may survive longer than you?

You’ll need to think about these options to decide your next steps.

You may even find yourself in a position where no longer need life insurance. But with Americans now living longer than ever, you need to consider carefully.

Brush up on your terminology

It may have been decades since you last looked at the options, so let’s quickly go over the principal types of life insurance and how they work.

  • Term life insurance covers a fixed period of time at a lower premium than permanent insurance. It’s generally less complicated and pays out a predetermined sum to beneficiaries.
  • Permanent life insurance runs indefinitely and represents an investment, as your payments contribute directly toward the payout to beneficiaries.

As a general rule, those who are younger and have less disposable income take out term life insurance. It provides a safety net for their dependants while only demanding a small premium.

In theory, as we move into our later life, we find ourselves with fewer dependents and more wealth. Permanent life insurance becomes more practical.

Work out what you need

It’s possible you won’t need life insurance at all when your term life insurance policy ends. Whether you do or not will depend on a few factors, which we can summarize as follows:

End of life cover – The most immediate concern for your family will be to cover funerary costs, so be sure they’re well provided for. Modern funerals can be expensive. If you’re not confident they’ll be covered by your own estate, then life insurance is a no brainer.

Debt – If you have any debt that can be passed onto your dependents, you’ll want to be sure they’re not paying out either from their own pocket (in the case of shared debts) or from your estate (in the case of debts recoverable from your person).

Your dependant’s needs – Chances are you’ll be leaving dependents behind, whether they’re aging parents or your own children. Will their living costs be covered? Are there college fees and similar to think about? Will your partner be provided for in the future?

Business needs – Should you own a business, you’ll need to give thought to how the company will manage after your death. Will it require funds from a life insurance policy to keep afloat? Whether your family will inherit the business or sell it on, there’s sure to be a period of transition.

Once you’ve given thought to these questions, you can start to decide on a way forward.

Shopping around or converting your policy

If you’ve reviewed your situation and decided that further life insurance is right for you, then it’s time to shop around.

With this chance to reassess, don’t automatically return to your current insurer.

A lot may have changed since you took your term life insurance, so shop around and see who can offer the lowest premiums or the greatest benefits to you.

Alternatively, you may decide to stick with your current insurer to convert your policy to permanent insurance.

You’ll need to check with your insurer whether there’s provision for this in your policy, and bear in mind that this is often only available at certain intervals.

Combining policy types

It’s possible to combine multiple life insurance policy types, so you may want to consider this an option when your term life insurance policy ends.

This is a good solution for those who like the idea of an accumulating insurance policy but who may be afraid they can’t afford the higher premiums which come with it.

By combining policy types, you can choose exactly how much to pay for each policy type. You can split the figures down the middle or give more weight to your term or permanent option as you see fit.

Purchasing riders

If you feel your life insurance policy won’t match your needs, now is a good time to take a look at riders.

Riders are additional benefits that you can add to an existing policy. While some can come standard at no additional costs, expect to pay additional premiums for the majority of policy riders that are available today.

Let’s walk through some of the most useful riders:

  • Accelerated death benefit – usually included automatically, accelerated death benefit allows you to bring forward some of your insurance if you become terminally ill.
  • Critical illness – Similar to the above but without the short-term life expectancy involved, the critical illness rider allows you to claim insurance for a number of conditions that you’ll find listed on the policy.
  • Waiver of premium – If this rider is active, the onset of a total disability preventing you from working would ensure you no longer need to pay your premium.
  • Return of premium – This rider grants a return on your premiums in the event you outlive your policy.
  • Child protection – This rider covers the eventuality of losing a child and the resultant financial impact on your family.
  • Guaranteed insurability – This rider opens up the possibility of purchasing additional insurance within your policy without the need to go through an additional medical evaluation.
  • Term conversion rider – If you should decide to convert your term life insurance into permanent insurance, a term conversion rider will remove the need to undergo a medical evaluation.

There’s a lot to consider when your term life insurance policy ends, but with all of this in mind, you’ll be better informed to make your decision. If you need further advice, just get in touch with us and we’ll be glad to help. Alternatively, you can request a quote from us using the form on the right.

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Jeffrey Manola

Jeffrey Manola

Jeffrey Manola is an experienced life insurance agent and the founder of Top Quote Life Insurance. His mission when he created Top Quote Life Insurance was to provide online consumers searching for life insurance with the absolute best quotes for term life insurance, permanent life insurance, no medical exam life insurance, and burial insurance.

Not only does he strive to provide you with the best rates for your life insurance coverage, but he also wants you to be well informed about the different types of life insurance options that are available. You will also find a significant amount of valuable information on the multiple life insurance companies that can provide you with coverage.

Jeffrey Manola is licensed to provide expert advice and help aid in the purchasing process of life insurance products. He is licensed with the National Insurance Producer Registry (NIPR) in the following states:

AL: 790866 AR: 14358927 AZ: 14358927 CA: 0K29801 CO: 531038 CT: 002536246 DC: 3000281706 DE: 3000190912 FL: W383615 GA: 3089339 HI: 482421 IA: 14358927 ID: 646048 IL: 14358927 IN: 3100885 KS: 14358927 KY: DOI-986908 LA: 758187 MA: 2045330 MD: 3000011601 ME: PRN252004 MI: 14358927 MN: 40427014 MO: 8428106 MS: 10519253 NC: 14358927 ND: 14358927 NE: 14358927 NH: 2434852 NJ: 1562332 NM: 14358927 NV: 3299018 NY: LB-1484031 OH: 1117369 OK: 100293583 OR: 14358927 PA: 740709 RI: 3000183893 SC: 14358927 TN: 2383399 TX: 1969337 UT: 648983 VA: 987464 VT: 3426230 WA: 947010 WI: 14358927 WV: 14358927

Never hesitate to reach out to Jeffrey if you need help. Top Quote Life Insurance is more than just an online quoting agency. We want to help you save money, protect your future, and earn your trust (888) 777-7574.

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Life Insurance Rates?

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Or give us a call...888-777-7574