There are two types of life insurance policies: term and permanent.
One of the most significant differences between the two is that term life insurance is a temporary product. It has an expiration date.
What happens when term life insurance expires? Your coverage ends, and you stop paying premiums.
In this guide, you’ll learn how long term life insurance lasts, what happens if you outlive your term life insurance, and if you can extend your coverage.
Table of Contents
- Do Life Insurance Policies Expire?
- How Long Does Term Life Insurance Last?
- What Happens at the End of Term Life Insurance?
- What to Do When Your Term Life Insurance Is Expiring
Do Life Insurance Policies Expire?
It depends on the type of policy you own:
- Permanent life insurance products don’t expire. These policies, including whole and universal life, are designed to last your entire life.
- Term life insurance does expire. It’s designed to be temporary.
When life insurance coverage expires, you are no longer insured. If you die before the expiration date, your beneficiaries receive a death benefit check from the insurance company. If you die after the expiration date, your beneficiaries don’t receive a payout.
How Long Does Term Life Insurance Last?
Term life insurance offers fixed rates that last 10-40 years. So, if a 40-year-old buys a $500,000 20-year term policy for $30 per month, the cost remains $30 until it expires at age 60.
Ideally, you buy term life insurance to financially protect your loved ones during their most vulnerable years. The years when, if you were to die unexpectedly, they would struggle financially due to losing your income.
During these years, you may be:
- Raising children
- Saving for retirement
- Paying off a mortgage
- Running a business
If you were no longer around to provide for your loved ones, what would they do? This is why families should have term life insurance. It’s planning for the what-ifs.
Learn more: How Long Should My Term Life Insurance Last?
Not sure how much term life insurance you need?
What Happens at the End of Term Life Insurance?
At the end of your policy’s term, you no longer have to pay any premiums, and your coverage ends. The insurance company will typically send you a notice informing you that your coverage has officially ended.
Can You Get Your Money Back?
If you outlive your term life insurance coverage, you only get a refund if you purchase return of premium life insurance. Because you get a refund if you don’t die, ROP term life insurance is more expensive than traditional level term life insurance.
For example, a healthy 40-year-old male can buy a traditional $500,000 term policy that lasts 20 years for $28.42 per month. The return of premium version would be $141.24 per month.
Most people choose the cheaper term policy since investing the difference over those 20 years often makes more financial sense.
What to Do When Your Term Life Insurance Is Expiring
If your term life insurance policy is ending and you want to continue to make sure your family is protected, you have some options:
- You can buy a new policy.
- You can convert the policy into a permanent one.
- You can renew your term coverage.
- You can go without life insurance.
Buying a New Policy
If your health hasn’t changed much, buying a new term policy will be the least expensive way to continue coverage. You don’t need to buy the same coverage amount or term length as your original policy.
For example, you purchased a 20-year term policy when your first child was born. You now have two children, one in college and one in high school. Perhaps you just want an additional 10-year term policy to ensure all your children are independent and no longer relying on you financially.
Converting Your Term Policy
Many term life insurance policies have a conversion rider automatically included. The rider would ensure you can convert your term policy into a permanent one regardless of your health status as long as you convert before the deadline.
The benefits of converting a term policy:
- You don’t have to go through underwriting or take a medical exam.
- You maintain the original health rating from the term policy.
- You can decide how much of the coverage to convert.
- You get life insurance coverage for your entire lifetime.
If you decide to convert, your premiums will increase drastically. You’ll no longer have a term policy. Instead, you’ll have a permanent policy, and permanent insurance is much more expensive.
If you’re interested in converting, check the conversion expiry date listed on your policy.
Renewing Your Term Coverage
Many insurance companies have renewability options on their term products. This means you can extend the coverage term year after year without having to re-qualify.
The catch is that renewable premiums are far higher than your initial fixed premium.
For example, you purchased a $500,000 20-year term life insurance policy when you were 30. Your annual cost is $244.
You’re now 50, and your policy expires this year. You can choose to renew the policy to extend the coverage another year. This means you’ll keep your $500,000 in coverage but no longer qualify for the $244 annual premiums. To renew the coverage, the annual premium is $2,989. Each year you renew, these premiums increase.
For people who are diagnosed with a severe medical condition, this option can be life-saving for your loved ones. Imagine your term insurance is about to expire, and you’re diagnosed with terminal cancer. You can opt to renew your coverage to ensure you don’t leave your family with a pile of medical bills.
The benefits of renewing a term policy:
- Allows you to reclaim your coverage at the end of your initial term.
- Allows you to keep your policy’s original face value amount (or death benefit).
- Permits you to renew your term life policy without starting the application process again.
- Exempts you from answering medical questions or undergoing a medical exam to prove insurability.
No Longer Have Life Insurance
If your expiration date is approaching, you can simply let the coverage run out. Depending on your situation and the stage of your life, you may not need life insurance anymore.
You likely do not need life insurance if:
- You have paid off your mortgage.
- You have no significant debt.
- You have no financially dependent children.
- Your spouse does not rely on your income.
- You’ve retired (or are retiring soon) and have sufficient savings.
If you currently own a term life insurance policy, check when the conversion period expires, when your term expires, and if it can be renewed. If you aren’t sure how to find this information on your policy, contact your life insurance agent or broker.
Ensure your life insurance policy continues to meet your needs. Use our guide to understand when and why you should review your life insurance policy.
See what you’d pay for life insurance
Talk to a Quotacy Agent to Understand Your Policy Options
If the end of your term policy is approaching and you still want coverage, contact us here at Quotacy, and we can help you with the next step. Take a second to run a quote, too, so you know how much a new term policy may cost you.
You don’t have to spend time shopping from company to company. Our quoting tool lets you receive instant term life insurance quotes from multiple companies. When you’re ready, complete your application online, and your agent will shop your case to ensure you get the best price. You don’t have to keep your previous life insurance company. You always have options. Make the best of them.
Note: Life insurance quotes used in this article are accurate as of March 1, 2023. These are only estimates and your life insurance costs may be higher or lower.
Hi Natasha, my name is Phil and I hope you can help me by answering my question. I purchased a Gerber 20 year term life insurance policy in 1987, The police is a 20,000 dollar policy. I’ve obviously out lived the term, but I’ve been paying annually since I purchased the policy. I don’t ever remember converting the policy, I’ve just always paid the bill when it has come due. My question is did they convert the policy automatically and if not, do you think I would be entitled to a return of all premiums paid from the end of the term until current day? Anticipated thank you for your time.
Phil
Hi Phil, you could be paying renewal premiums. Many term life insurance policies can be renewed year after year. Or it could be a $20,000 permanent policy. I recommend calling Gerber and asking for a policy review. Their life insurance customer service line is 1-800-704-2180. They can answer questions regarding your policy.
Thanks for your help Natasha. It is very much appreciated.
Regards,
Phil
If I outlive my term life and I die after will my beneficiary still get the money????
Hi Terry, a term life insurance policy provides coverage for a specific number of years, the policy’s “term”. Once the term ends, the coverage ends unless you renew it or convert the policy.
I had a life insurance of $250,000 for 30 years when I retired they did not informed me about my policy until after 30 days they said I lost all the money I paid to leave my sons is there anything I can do
Maria, a $250,000 30-year policy sounds like it was term life insurance policy, but you mentioned “they” informed you when you retired that you had it. Is “they” your employer? or the insurance company? If it’s a term policy, expiring after 30 years is normal if it has a 30-year term.
To continue coverage, call the insurance company and ask what the expiry date is for renewing or converting the policy. Do this soon, this period of time may have already passed. But be aware that premiums will skyrocket if you choose to renew or convert it. If you still need life insurance coverage, you may be better off applying for a new term policy. You can find out what your premiums would be before committing to purchase.
If you outlived your term insurance..
You lost all your money you have paid for ten years
My husband has a 10 year term life insurance policy that will end in May of 2020 unless he decides to pay very high premiums. He wants to sell his policy to a company that would buy it and pay him to purchase the policy. We won’t be able to afford the high premiums so he will just have to end the policy. Is it a good idea for him to sell his policy? Does he have other options?
Josie, life insurance settlement companies only buy permanent life insurance policies or term life insurance policies that are convertible, pending on a few factors. If your husband’s term policy is convertible to a permanent policy and a doctor has given him a life expectancy of 10 years or less, then a life insurance settlement company may be interested. If these factors apply to your husband and his policy, reach out to your life insurance agent for assistance because this process can be complicated.
If those factors don’t apply and you foresee your husband needing more life insurance coverage after the 10-year term is up then you may want to consider simply buying a new term policy if he’s still insurable. Depending on his age and health, these premiums would likely be much lower than renewing or converting his current term policy.
I am 57 and would like to open a life insurance policy that leaves my daughter 200.000 can you suggest one and length of policy also should I pass before paying the whole policy how much would she receive
Hi Paul, being only 57 years old you have a few options.
You can buy a term life insurance policy with a term length as high as 25 years if you’d like. If you passed away prior to it expiring, your daughter would receive whatever the face amount is. You can buy a term policy with a $200,000 face amount.
Or you could buy a guaranteed universal life (GUL) insurance policy also with a face amount of $200,000. This is a permanent policy so it would be active until you died and would leave a death benefit of $200,000.
The GUL policy will be more expensive than the term policy. But neither policy requires you to pay the “whole policy”. The required payments end when you pass away or when the policy expires, as is the case with the term policy. Even if you purchased one of the policies and died a year later having only paid one year’s worth of premiums, your daughter would still receive the full death benefit amount.
You can run both types of quotes right here on our website to give yourself an idea of how much the premiums would cost. Head here: https://www.quotacy.com/life-insurance-quotes/ enter your basic info and then you can choose a term length or “Forever” to view the GUL policy quotes. Contact us if you have any more questions.
My insurance company returned my last premium saying I have paid the limit that can be paid on my $50,000 term life insurance policy. I have 5 more years on my term.
I have paid $50,016.30. They tell me IRS code limits amount I can pay because if pre.iums go over that amount then policy becomes taxable on payout to beneficiaries. If no premiums are paid do I still have a policy of $50,000?
Hi Emily,
There are a lot of factors that may or may not be in play here, so I will offer the best information I can based on assumptions I am making from your comment.
I am assuming you have been paying renewal premiums on your term policy for a few years, hence cumulatively paying in as much premium as your total death benefit. And you mention you have 5 years left, so I assume your term policy is renewable to a certain age, one that you will reach in 5 years?
If you do not keep paying premiums your term life insurance policy will lapse and your beneficiaries will not receive the $50,000 death benefit.
If you want to provide more information, such as your age, how much your premiums cost, and the insurance company you purchased through, we would be happy to try and help further.
Otherwise, reach out to your life insurance agent or call the customer service line to ask how you can keep the policy inforce to make sure your beneficiaries get a payout.
Thank you. I will call my insurance company..its been sold many and is now called American Republic Ins Co. Des Moines, Iowa. I am 90 and had this policy since age 60 when I retired. Know I cannot but life ins. at my age.
I was reading a lot about Indexed UL policies. Are they worth it?. Combined with term insurance (250K + 500K) coverage. Is this best option for investment growth and death benefits?
Rogen,
Excellent question! IUL (indexed universal life) is an interesting life insurance product. To directly answer your question about whether this is the “best” option for death benefit and investment growth, the answer is that it depends on your financial plan and the product and design that you choose.
Many life insurance companies now offer an indexed universal life insurance option, and it is the fastest growing product in the life insurance market place. Insurance companies really like this product and it can be shown on paper to drive a lot of tax advantaged income in our retirement years. That being said, the design is very important.
When funding an IUL product it is key to make sure to over-fund the contract. If at all possible, it should be funded up to the MEC limit. Otherwise it is not much of an investment opportunity. Many times they are created with a 5 or 7 pay. This allows the best design to grow the cash value in the contract. It should be designed with life insurance as a wrapper, but the real purpose of the policy is to drive cash value, not death benefit.
The other thing to keep in mind is that there is no way the illustration that you are looking at will perform as shown. It is created with a fixed return over all years. That is not the way the contracts work. And there is something called a cap on the policy. This is typically between 8-11%. The insurance company reserves the right to drop this cap at any time. Meaning that it is definitely not guaranteed to stay the same for all years.
Your expectations for the policy should be tempered and it is helps to know that the product will not perform as it does on paper. Maybe it will perform better in real life, but it is quite possible that it will perform worse (or even much worse).
And last but not least, there are some companies that have moved beyond an easily understandable indexed universal life policy to a quite complex product with lots of moving parts. The ‘new’ extras involve leveraging and multipliers (these have come into play over the last couple of years after the NAIC create a rule called AG49). They sound great on paper and show huge numbers for retirement income, but there are big risks with taking that approach.
A vanilla IUL (one without those bells and whistles) has cash value downsize protection and an opportunity to grow at a faster rate than a vanilla whole life insurance policy. The new bells and whistles on some of the IUL products put much more risk on you as the client and negate the downside protection. It makes them work more like a security product than a place for your safe money.
So, in response to your question one more time: it depends. It is important to work with a skilled advisor who can share with you the risks and rewards and who brings deep life insurance knowledge into the equation to help you make your decision. The internet is full of advice and information, but some info isn’t easily found and needs the interpretation of a life insurance expert.
My question is if my father did the term life and lived to age 86…are you saying that his insurance has ended and he can get a payout or renew and pay a higher premium?
Val,
Term life insurance is only active during the years of the term. If your father purchased a 10-year policy, it will be active for ten years. If your father’s term life insurance policy has ended, there will not be a payout. Before the policy ends, he can choose to renew the policy and pay the higher premiums. He could also choose to convert the term policy into a permanent policy if his policy includes a conversion option.
Would it be better for a 70 year old man to take a 20 or 30 year term so the term insurance will not run out by the time you’re 90 years old or 100 for 30-year term
Leslie, a 20-year term policy is going to be your best bet between those two options. Insurance companies have maximum age limits for life insurance policies. A 70-year-old individual will likely not be able to qualify for a 30-year term policy. And only a handful of companies offer a 20-year term policy to someone 70 years old.
hey I just wont to ask a question.My mon had a term life insurance which was for 2 year but she onli live 1year and a half of the policy but she was buried but the insurance company said they have not paid anything until they get her medical and doctor report so how will I know they will payoff the policy or not or what they are looking at to tell if they can payoff
Felisha, I’m sorry to hear about the death of your mom. In regards to your question, most life insurance policies have a two-year contestability period. This means if the insured person dies within the first two years of owning the life insurance policy, the insurance company can investigate whether everything on the application was accurate. For example, if the cause of your mother’s death was lung cancer due to smoking but she claimed on her application that she did not smoke, the insurance company can then deny having to pay out the benefit. If there is nothing amiss, the insurance company will pay the benefit. Assuming you are the policy beneficiary, they will let you know.
I am a63 year old female I got my insurance when my husband was living,now he is deceased today I received a letter,saying my term life insurance will go up the first of the year. From 46dollars a quarter to 212.46 every guarded. I wasn’t told the time. So that’s money I lost,because I can’t afford it now
Mary, I’m sorry to hear your husband has died. In regards to your life insurance policy, this is typical for term life insurance. A term life insurance policy has fixed premiums for a specific amount of years (10, 15, 20, 30, etc. whichever term length you chose) and then it expires or renews. Renewing it increases the premiums exponentially. Ideally, term life insurance expires when your beneficiaries no longer need the financial protection. You can let your term life insurance policy terminate since you cannot afford the renewal premiums. Most people do not renew or convert their term life insurance policies.
Hi i want to have a full life coverage but i have one question.What if i would relocate one day but will stay pay the premiums,how does this work if something happened to me abroad?
Hi Nancy,
Hypothetically speaking, if you purchased a life insurance policy today and then suddenly decided to move to Japan a couple years in the future and you died there, the life insurance company will still pay out the death benefit. However, if you are planning on buying a life insurance policy today and already know that you will be moving to Japan in a couple years, the life insurance company will want to know. There is a question on life insurance applications that ask something along the lines of “Do you have plans to travel or move outside of the U.S.?” Answer honestly so the insurance company has no reason to investigate your beneficiary’s death claim later on. Let us know if you have any more questions.
What happens if during the the term life insurance you get sick, let’s say on the 20th year of a 30 year term, are you still able to renew the policy after it expires? Or will you be considered having a pre-existing condition for the renewal and may become uninsurable or have very high premiums?
Hi Gali,
If you have a renewable term policy you can renew it even if you’re sick. Renewable term allows you to continue coverage without having to go through underwriting again. The premiums will be much higher after renewing, so this is only a financially viable option if you believe you would be uninsurable otherwise.
During the term life insurance you get sick, is term life insurance still valid? Why?
With a term life insurance policy, the insurance company pays out the death benefit if the insured individual dies during the term period. Being sick while insured doesn’t matter. When the term is expiring, if you choose to convert or renew the policy, being sick doesn’t matter in this case either. Insurability is guaranteed.
If i have a ins policy and only paid the premium for 3 yrs, does the policy cover the full amount
Hi Shara,
Yes. For example, if you bought a 20-year term life insurance policy and died in year three, your beneficiaries would still receive the full death benefit amount even though you only paid premiums for three years.
My sister have a 12 months term life insurance policy but she died within 4 months of her policy being renewed. Will insurance company pays her funeral expense?
Jessica,
I’m sorry to hear about your sister’s death.
Are you saying your sister died in month 8 of her 12 month term? If so, then the insurance company will pay out the death benefit.
If you’re saying that her 12 month term ended and then she passed away 4 months after she planned on renewing, but didn’t, then the death benefit won’t pay out. The grace period of most term policies is 31 days.
can I insure a sibling that doesn’t have insurance?
Hi Wayne,
If your sibling passed away, would you suffer financial loss? For example, do you both live together and pay rent? If so, you have insurable interest and you could purchase life insurance on your sibling if you have their permission.
I live with my parents can I purchase term or any insurance on them.
Chris, with your parents’ permission you may purchase life insurance on them. They will likely need to take insurance medical exams and have phone interviews with the insurance company to verify identity and the information on their applications.
My grandma have whole life insurance for only 1000 but she’s been paying for it every month for over 30 years, should the co.still take payment from her,she’s met the 1000 more than 3 times. Is this illegal
Hello Legretcia,
It sounds like your grandma has a guaranteed whole life policy. I advise you to call the insurance company, with your grandma, and ask them to explain the contract. As long as your grandma is present with you, the insurance company will most likely be willing to discuss it with you.
Hey! I was just wondering if I had a term policy and near the end my term, and decided to do a whole life policy. Would the premiums I payed in too the term policy stop? How does that work?
Hi Michael,
Yes. If you were to convert your term policy into a whole life policy, you would stop paying the term policy premiums and instead would begin paying the whole life policy premiums. Keep in mind your premiums will increase since a whole life policy is more expensive than term and your age is taken into consideration when converting (but not your health).
Another thing to keep in mind is the expiration period of your conversion option. Some policies do allow conversions up until the end of your term, but some instead require you to convert early on, for example, within the first ten years of the policy.
Some insurance companies allow partial conversions as well. For example, if you have a $500,000 term policy and only want to convert $50,000 of it into a whole life policy, you can choose to do so and would then have two separate policies. The term policy would drop to $450,000 and your premiums would drop to whatever the cost would be for that one, but then you’d also have a small whole life policy you’re paying into.
I hope that helps clarify things for you. Thanks for reaching out!
If you outlive your term life policy of 30 years, is this money you are able to then use or does it still just eventually go to your beneficiaries when you eventually die or is it the insurance company money because essentially you did not die during the 30 year period and you have finished paying for your policy
Hi Sophia,
You can think of term life insurance like your car insurance. You pay for it, but you hope to not need to use it. Term life insurance is protection against the what ifs in life. If you outlive your policy, you do not receive the money back unless you purchase return of premium term life insurance.
My mom is still paying her insurance monthly even though it has paid for her funeral expenses last year. What if she stops paying now?
Hi Patricia,
I’m not sure I understand what you mean that the policy has already paid for her funeral. Will you please share some more background about what you are asking and I am happy to answer to the best of my ability.
Hi, my ex-husband died in August of this year, leaving behind two children. we had a term life insurance for 15 years. He passed a couple of months before the policy was over. The insurance company had mentioned that we would receive $11,300 for the premium we paid. Since he passed do i still get that money including the death benefits?
Hi Bela,
The premiums being returned to you may be the unused premiums. Was the policy paid on an annual basis? For example, if your ex-husband paid $13,560 annually for his policy and died in the 2nd month, the unused remaining premium (ten months’ worth which would be about $11,300) would be returned to you. And you would receive this in addition to the benefit amount.
However, that is just a guess. We don’t know all the facts about the policy your husband purchased, so we cannot say for certain. We recommend that you contact the agent or insurance company who wrote the policy and ask them your questions. That will be the only way you know for sure.
If I have a term life 10 year policy for $300,000.00, and have only been paying on the policy for 2 years and die, is the full amount paid to my survivor?
Hi Lyn,
Yes – the full amount would be paid to your beneficiaries.
However, if you die within the contestability period, which is typically two years, the life insurance company can investigate whether you gave accurate information on your life insurance application. If they discover you misrepresented yourself, they can deny paying all or a portion of the death benefit. Same goes for suicide. If an insured person commits suicide within that two-year timeframe, the life insurance company has the right to not pay out the death benefit.
hi, is there a life insurance policy that if i pay my insurance and i dont die, that i get the money back that ive paid in
Hi Angela,
Yes – it’s called Return of Premium term life insurance. If you outlive the term policy, the insurance company will return the premiums that were paid in. However, this type of life insurance does come with higher premium payments than “regular” term life insurance.
Hi can I have a quote for return of premiums policy please
Hi David,
In order to obtain a quote for Return of Premium, please contact us directly as we would need to know a few factors such as your age, height and weight, and zipcode.
I purchased a term life insurance policy that ended when my husband reached the age of 80. It show cash values up until the 20th year of the policy. My husband’s 80th birthday was in September. No where on the policy did it state that the cash value would decrease after the 20th year.. Now the insurance company has decreased the amount they will pay for cashing in the policy to $900. The cash value at the 20th year was over $2000.
Hi Pearl,
Term life insurance policies today don’t accumulate cash value so I will assume you purchased this quite some time ago. Right now, it sounds like the policy is being kept active by using the cash value to continue to pay the premiums. This would explain why the cash value is decreasing. It will continue to decrease each month you do not cash in the policy. I advise you to contact the insurance company to make sure this is, in fact, what is happening and request to surrender the policy before the cash value is completely drained.
Is there an ongoing life insurance policy out there. One that you can continue to make monthly payments to without having to specify a term eg: 5, 10 years, etc and the surviving partner will get a payout when the other dies?
Hi Hayley,
The life insurance product you are referring to is a permanent policy. This is exactly what it sounds like – as long as you pay the premiums keeping the policy inforce, it will last your entire lifetime and the insurance company will pay out a death benefit to your beneficiaries when you die.
There are a few different types of permanent products, the most common one being a whole life policy. Permanent policies are more complex and more expensive than term policies. We have a life insurance consultant here on staff whom you can speak to if you would like more information on permanent policies. Give us a call at (844) 786-8229 if you are interested in learning more.
My parents took out child life insurance in my name when I was a baby. They have been paying the premium but it has now expired and I have received a cheque in my name. My parents are saying the money is theirs because they paid the money although I think it is mine because the policy is in my name and the letter / cheque that has been sent is in my name. Can anyone shed some light on this please? Thank you
Lu,
If you want to assign the check to your parents, then you can do that. Since the check is in your name, you have the ability to cash it and keep it for yourself as well. I don’t know the relationship you have with your parents, nor what impact you ‘keeping’ the money will have on your ongoing relationship with your parents. This is your call and the decision is in your hands. My advice is to find a path that results in as little suffering for both you and them as possible.
Very simple and precise answer. Thank you
I am reading this because my Mom has outlived her policy and your first name is hers and last name is her maiden name