Term life insurance protects you at a guaranteed level premium for the duration of the policy’s “term.” Typical terms might be anything between 10 and 30 years. You’ll need to decide on what to do next when the insurance term is set to expire.
You might believe that once the term is through, you won’t have as many financial commitments, and insurance won’t be as crucial. That might be acceptable if you’re confident that the people you care about won’t require financial protection for another 15 or 20 years.
It makes sense. However, life always has plans, and it’s better to be safe than sorry.
What Happens When Term Life Insurance Expires?
If the term of your policy has expired, it is no longer effective, and you are not protected by it.
If the term of your policy has not expired, but you have chosen to cancel it, then the insurance will continue to be in effect until the policy lapses or is canceled. Suppose you have a permanent disability that began before your term life insurance policy started and was covered under the terms of the procedure (i.e., pre-existing condition). In that case, your benefits may still be available even though the duration of your policy has expired.
Let’s look at your choices once your term life insurance policy expires:
- Renew your term policy: If you want to keep your coverage, you can renew your policy. The renewal process will involve submitting a form and paying the premium. It is important to note that the policy will not become effective until you receive a renewal notice from your insurance company.
- Invest in a new term policy: If you want more coverage, you can buy a new term policy. The new policy will have the same terms as your old policy but may be cheaper because it will not have an expiry date. It is a good idea to compare the costs of different term policies before deciding.
- Invest in a permanent policy: If you want to ensure that you will have coverage no matter what, you can invest in a permanent policy. A permanent policy will provide lifetime coverage and is not subject to the expiration date of your term life insurance policy.
- Convert your term policy: If you have an expired term life insurance policy, you can convert it to a permanent one. To do this, you must submit a form and pay the premium. The conversion process will make your coverage permanent and require no additional insurance.
- Layer policies: You can also buy additional life insurance policies to increase your coverage. This is a good option if you are unsure whether you want to buy a new term policy or convert your old one. By purchasing multiple policies, you will have more coverage in case of an accident or illness.
Winding It Up
Before deciding, it is important to compare the costs and benefits of different term policies. By investing in a permanent policy or converting your old term policy, you can ensure that you have coverage no matter what.
Get the Best Term Life Insurance at Action Insurance
Looking for a reliable term insurance agency in Vancouver? Contact our team at Action Insurance Group right away. We will create the best term life insurance policy to provide benefits to your loved ones in the future, even if you are not there.
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