Term life insurance is a type of life insurance policy that provides coverage for a fixed period of time. The policyholder pays premiums for the chosen term, and if the insured dies during the term, the policy pays out a death benefit. But when does term life insurance expire?
|5-30 years (issued in 5-year increments)||End of contracted term|
|Yearly renewable term||End of yearly term if not renewed|
As shown in the table above, term life insurance expires at the end of the contracted term. The length of the term can be chosen by the policyholder, typically ranging from five to 30 years. Yearly renewable term plans expire at the end of their yearly term if not renewed. Alternatively, some term policies may be purchased to end at a certain age, often 65.
Several factors should be specified in the contract, such as how long the policyholder can keep the term life insurance policy. Once the policy expires, several things may happen:
- The policy can be renewed at a higher premium rate.
- The policy can be replaced with a new term or permanent policy.
- The policy can be allowed to lapse, providing no coverage.
If the policyholder outlives the policy, they may have the option to convert the coverage to a permanent policy. However, the specifics of this option will depend on the terms set forth in the original insurance agreement.
- Oklahoma State University. Your Term Life Policy Is Expiring. Here Are Your Options.
- Miami University. What Happens If You Outlive Your Term Life Insurance?
- Purdue University Extension. Does Term Life Insurance Expire? - Aig Direct
- University of Minnesota. What Happens When Your Term Life Insurance Expires
- University of Michigan. What To Do When Your Term Life Insurance Expires (2023)