Whole life insurance offers coverage for the rest of your life and includes a cash value component that lets you tap into it while you’re alive. Whole life insurance is more expensive than term life insurance because people with a whole life policy are guaranteed to have a death benefit when they die.

Policy Type	Coverage Amount	Term Length
Whole Life Insurance	$8 million	Instant (5 minutes or less)
Term Life Insurance	$500,000	10, 15, 20, 25 or 30 years

Whole life insurance offers three kinds of guarantees:

• Guaranteed death benefit
• Guaranteed cash value growth
• Guaranteed level premiums

Policyholders of whole life insurance are usually eligible for annual dividends from the life insurance company. If you’re buying whole life insurance, confirm that the policy is “participating” so that you can reap the benefits of dividends.

When you buy a policy, you’ll choose a life insurance beneficiary to receive the death benefit. You don’t have to split the payout equally among beneficiaries. You can designate the percentage for each, such as 75% to Mary and 25% to John. It’s also a good idea to designate one or more contingent beneficiaries.

Most whole life policies have a guaranteed return rate at a low percentage, but it’s impossible to know how much your cash value will actually grow. You can tap into cash value with a withdrawal or a loan, or also by surrendering the policy. If you take a loan, it’s tax-free, and you can pay it back, with interest.

Whole life insurance isn’t that simple. If you stop paying, the insurance company will use the cash value to pay any premiums until the cash value runs out and the policy lapses. But there are alternatives to simply stopping payments.

Whole life insurance is simply unaffordable for many people. Many life insurance shoppers look at term life vs. whole insurance costs. It’s never an apples-to-apples comparison because the policies are so different. That said, here are examples of whole life insurance quotes based on a 30-year-old male of average height and weight for $500,000 in coverage.

Given the expense of whole life insurance and that many people do not need insurance for their entire lives, whole life insurance is often not worth it. However, there are some specific situations where buying another form of permanent life insurance makes sense.

Life insurance policies can end due to various reasons, such as the policyholder deciding to cancel the policy or non-payment of premiums. While the types of permanent life insurance policies are designed to last a lifetime, for legal reasons, a maturity date is also set. However, the expiration or maturity date of a life insurance policy varies based on the type of policy selected.

Term Life Insurance

Term life insurance does not have a maturity date, but instead has an expiration date. The policyholder selects the term length when signing up for a policy, usually between five to thirty years. If the insured is still alive at the end of the term, the policy will expire, or the policyholder may renew or purchase another policy for future financial protection if they were to pass away during the next term.

Permanent Life Insurance

Permanent life insurance is designed to last for the policyholder’s entire life, as long as they continue to pay the premiums. However, even these types of policies have a maturity date, usually when the policyholder is between 100 and 121 years old. If a permanent life insurance policyholder lives to the maturity date as stated in the policy contract, the policy value will be paid to the insured.

Conclusion

Term life insurance policies can provide financial protection if the policyholder dies within the term length they selected. With premiums starting at $11 per month, a death benefit could go towards significant expenses such as mortgages or college tuition. On the other hand, permanent life insurance policies can provide lifelong financial protection. However, even these policies have a maturity date, and if the policyholder is still alive, the policy value will be paid to them. Therefore, it is essential to understand the differences between the two types of policies and choose the right one based on your needs and financial goals.

Bestow Life Insurance Company

North American Company for Life and Health Insurance®

Policies are issued by Bestow Life Insurance Company, Dallas, TX on policy form series BLI-ITPOL. Bestow Life Insurance Company products may not be available in all states. Policy limitations or restrictions may apply. Not available in New York.

Life insurance quotes provided by Bestow Agency, LLC dba Bestow Insurance Services in CA, who is the licensed agent. Term Life Insurance policies offered by Bestow are issued on policy form LS181 and LS182, or state version including all applicable endorsements and riders, by North American Company for Life and Health Insurance®, West Des Moines, IA. Products or issue ages may not be available in all jurisdictions. Limitations or restrictions may apply. Not available in New York. North American is rated A+ (Superior) by A.M. Best. A+ (Superior), the second highest rating out of 15 categories, was affirmed by A.M. Best for North American Company for Life and Health Insurance as part of Sammons Financial Group on July 29, 2022.

Term life insurance policies are taken for a specific period of time and expire once that term is up. But what happens when your term life insurance expires? Do you need to buy a new policy? In this article, we will look at the options available when your term life insurance policy expires.

Assess Your Financial Situation

The first step is to assess your financial situation. Do you still have dependents? Is your estate sufficient enough to sustain them into adulthood? Is your mortgage still pending? Does your partner depend on your income to maintain their quality of life? Only an honest introspection into your finances can help you understand these future needs.

Options When Your Coverage Ends

If you determine that you’ll need continued coverage then broach this conversation with your insurance advisor or broker 6 months before the maturity date. Any later and you risk getting caught in a coverage gap. This gives you enough time to study all the available options and choose the one that is best for you.

If you’re fortunate enough to not require any more insurance coverage, then all you need to do is pay the last premium and wait out the policy. Once the plan ends, you won’t be covered and nor will your beneficiaries receive any payout upon your death. Of course, that means you no longer need to pay your monthly premium as well.

Renew Your Term Life Insurance Policy

Many term life insurance policies offer the choice to extend the policy term beyond the initially agreed date. This is referred to as a renewability rider and may have been touted as a feature of your policy when you first purchased it. This extension is usually valid until you reach a certain age (generally 75 years), though it varies from company to company.

Pros	Cons
Saved from the hassle of shopping for a new policy	Higher premiums
Exempt from displaying proof of insurability	Revised premium can be 5-10 times more expensive than your previous coverage

Convert Your Term Life Insurance Policy

Convertibility is another rider that some insurance companies offer as part of a base term life insurance policy. Once the term is up, you have the choice to convert your term policy into a whole life insurance plan.

Pros	Cons
Retain your coverage	Higher premiums
No proof of insurability required	Converted policies are only eligible for selected permanent policies

Buy a New Policy

If your financial needs have stayed level or increased, then considering a new policy with the right amount of coverage can be a smart option.

Pros	Cons
Several types of policies available to choose from	Requires work to shop for a new policy
Lower monthly premium compared to renewing or converting existing coverage	Medical condition may make a new policy difficult or unaffordable
Get as much or little coverage as you need at this time

Outliving your term life insurance can be considered good news. But it also brings forth the dilemma of considering whether to forego life insurance or not. If your dependents are now self-sufficient and your retirement plans are in place, then you can simply let your policy expire upon maturity. But if this is not the case, you need to consider new coverage.

Speak with an experienced insurance advisor to explore all your options and see where you can save money while maintaining the coverage you need.

Term life insurance is a pure life insurance product designed to provide coverage for a specific term or period of time, typically between 10 and 30 years. But what happens when the term of your policy is coming to an end?

Option	Description
Extend your current term policy	You can usually keep on renewing your policy on a year-to-year basis until you are 95 years old. However, the insurance company will change your premium if you extend.
Convert your term policy to a permanent policy	You can convert your term policy into a permanent policy without having to provide evidence of insurability. Different insurance companies have different ways of handling term-to-permanent conversion, and there will be a specific deadline as well.
Get a different life insurance policy	You can shop around for a new term-life policy or combine a permanent policy with a term policy to get the higher death benefit and additional coverage you need for a limited period of time.

If your family still needs the financial protection of life insurance, you have the above three basic choices. Extending your current term policy can be a good option, but the insurance company will change your premium if you extend. A permanent policy is designed to provide coverage you can’t outlive, and it includes a cash value component, but the premiums can be higher than they would be for a term policy with the same death benefit. Getting a new term-life policy or combining a permanent policy with a term policy can be one way to get the higher death benefit and additional coverage you need for a limited period of time. The type of policy that was right for your needs 10, 15, or 20 years ago may not be the best choice for your current needs today.

When it comes to life insurance, there’s no good way to answer that without taking a look at your current situation and assessing who is relying on you for protection. Talk to your life insurance company, agent, or broker well before it expires, and make sure to find out about the types of life insurance policies available, costs involved, and if you’re thinking of conversion, what specific options are available to you.

Deciding when to stop paying for term life insurance can be a delicate matter. It depends on your personal and financial situation, as well as your beneficiaries’ needs. Here are some scenarios that could indicate you no longer require life insurance:

Scenario	Explanation
No dependents	If you no longer have dependents who rely on you financially, you may no longer need life insurance.
Financially stable	If you have paid off your mortgage, your children’s student loans, or have a significant amount of savings, you may no longer need life insurance.
Over 65 years old	If you are over 65, you may consider surrendering your policy, letting it lapse, or selling it through a life settlement, especially if you qualify.

It is essential to consult your insurance provider and financial advisor for advice.

Term life insurance policies typically last for 10, 20, or 30 years. Once the policy expires, there is no payout, and you may transition to a whole life coverage policy, which does not expire, but is more expensive. Whole life insurance policies can end through cancelation, a lapse, a life settlement, or a death benefit payout to beneficiaries.

If you have employer-provided life insurance plans after retirement, you can still keep them. However, premiums may increase because you are no longer on a group payment plan connected to your employer. You can plan by exploring your insurance options ahead of time, whether you wish to stay on your employer’s plan or switch to independent coverage.

If you qualify for a life settlement, it may be a viable financial decision. Selling your life insurance policy reduces monthly payments while providing cash. If you are interested in exploring this option, contact your insurance provider.

In conclusion, there is no age cut-off to stop paying for life insurance. It depends on your financial situation, beneficiaries’ needs, and personal preferences. Consider consulting your financial advisor and insurance provider to make the best decision.

Term life insurance is a temporary coverage that lasts for a specific length of time, usually between 10 to 30 years. Unlike permanent life insurance policies, term life insurance coverage ends when the term expires, and the policyholder does not receive any death benefit if they outlive the term. However, if the policy has a return-of-premium feature, the policyholder will receive the amount paid into the policy throughout its term.

Renewing or Converting Term Life Insurance

When term life insurance expires, the policy becomes invalid, and the policyholder no longer needs to pay the premiums. However, some term policies allow policyholders to renew their policy annually or convert it to a permanent insurance policy before the term expires.

If the policy has a conversion rider, the policyholder can convert it to a permanent insurance policy without taking another medical exam. It is essential to be aware of the conversion policy’s deadlines to ensure that policyholders convert it before the policy expires.

Buying a New Policy or Permanent Life Insurance

If policyholders need further coverage after the term policy expires, they may opt to purchase a new term policy or permanent life insurance policy. However, buying a new term policy may require a medical exam, and the premium may increase if there are new health issues. On the other hand, permanent life insurance policies are more expensive than term policies, but they provide lifelong coverage and a savings component.

Before purchasing a new policy or converting a term policy, it is essential to review policy documents or speak to an agent to learn more about the options available.

Final Thoughts

If policyholders have no dependents or do not want to burden their heirs with end-of-life expenses, final expense life insurance may be a suitable option. However, final expense life insurance policies usually have low coverage limits and high premiums.

It is essential to evaluate individual circumstances and needs before deciding whether to renew, convert, or purchase a new policy or permanent life insurance.

Pros	Cons
Term life insurance is generally cheaper than permanent life insurance policies while young.	Term policies end when the term expires, and there is no death benefit if the policyholder outlives the term.
Conversion riders allow policyholders to convert term policies to permanent insurance policies without taking another medical exam.	Conversion policies typically have strict deadlines for conversion, often several months before the policy expires.
Buying a new term policy is an option for those who need further coverage after the term policy expires.	A medical exam may be required for a new term policy, and the premium may increase if there are new health issues.
Permanent life insurance policies provide lifelong coverage and a savings component.	Permanent life insurance policies are more expensive than term policies.
Final expense life insurance may be suitable for those who have no dependents or do not want to burden their heirs with end-of-life expenses.	Final expense life insurance policies usually have low coverage limits and high premiums.

Many life insurance policies issued before 2004 have a maturity date of age 100, which means the policy expires, and coverage ends when the insured person turns 100. This situation affects those who bought permanent life insurance policies long ago and now want their heirs to collect the payouts. The problem is that people are living longer, and these policies that seemed adequate decades ago are causing financial panic.

The solution is that insurers have added a Maturity Extension Rider (MER) to existing policies issued long ago to extend their coverage. It is a simple fix to the problem. However, there are many lawsuits being litigated related to the age 100 problem. The most prominent plaintiff was German refugee Gary Lebbin, who turned 100 in 2017. The Transamerica unit offered to pay him the “cash value” of the policy when he reached the century mark, but the heirs are still pursuing a settlement in court.

The first problem with this solution is that acquiring “cash value” at age 100 defeats the purpose of life insurance, which is to provide a tax-free benefit for heirs. The second problem is that many universal life insurance policies are based on stock or bond market indices, and the cash values in them can decline if either of those markets perform poorly during certain years. If a person with one of these problematic policies dies before age 100, then the entire amount of the original policy is paid as planned. But living too long means the policy could be worth only a small amount or nothing at all.

Problem	Solution
Policies issued before 2004 have a maturity date of age 100	Insurers have added a Maturity Extension Rider (MER) to existing policies issued long ago to extend their coverage
Acquiring “cash value” at age 100 defeats the purpose of life insurance	Policyholders should consult with a financial advisor when approaching their policy’s maturity age
Cash values in universal life insurance policies can decline	Add a Maturity Extension Rider to the existing policy or exchange to a new policy with lower costs and a longer maturity

Policyholders approaching their policy’s maturity age should consult with a financial advisor. It is important to get the right advice when buying a policy, or it may be too late to solve the situation when approaching the end of life. The insurance industry is based on sales rather than advice. Therefore, it is essential to compare policies with eight leading insurers and choose the best fit for your needs.