• Scott Nelson-Archer

Three options for when you reach the end of your term life policy

Updated: Sep 14


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When you buy term insurance, you purchase a defined amount of coverage for a premium that is guaranteed not to change for a fixed term period of time. Should you keep that 10, 20, or 30- year term policy in-force past its fixed term period your normal premium rates will increase pretty dramatically (usually 10x+). What most people do when they reach this point is to cancel the policy or let the policy lapse. But there are 3 options you might want to consider rather than just letting the policy lapse or surrendering it.


1: If you’re healthy and still need the protection term insurance offers your family, a simple rewrite might be the option for you.

When you re-write for a new policy you will receive current rates for your age and current health. Therefore, it’s a good idea to review the benefit amount along with the duration that is now needed based on your stage in life.


2: Sell the policy.

There are companies that buy life insurance policies from policy holders in this situation. The companies often convert the policies to permanent policies, then hold the policies until the eventual passing of the policy holder, thus collecting the death benefit.


3: Convert the policy from term to permanent.

If you still need coverage but no longer have the health that would allow for inexpensive coverage to be obtained, you can convert your policy.


If you are nearing the end of your term policy it is definitely a good time to talk with an insurance professional in order to learn more about what options that may be available in your unique situation.


Contact us today to find what is the best course of action for you.