Co-Founder, TermInsuranceBrokers.com, Goldenzweig Financial Group, Las Vegas, Nevada
If you have a term life insurance policy and the guarantee period on it is expiring, you have a several options:
1) you can continue to pay premiums as the policy will be annually renewable, however, the premiums will start to go up each year (based on age) by a substantial margin.
2) If the conversion period is still available, you can convert all, or a portion, of the face amount to a permanent policy with new medical underwriting.
3) you can stop paying premiums and let the policy lapse, thus ending your coverage.
4) you can apply for a new policy (can be with the same carrier or a new carrier) to secure a new term or permanent insurance policy.
If you have a term life insurance that is set to expire soon, run, don't walk, to find out your options before it expires. You can ask your current agent, call the life insurance company, or pick out an agent you feel you can trust and ask them to compile your options for you.
If your health has gotten worse since you took out your term policy, you may not have the option to buy as much coverage as you would like, in a new policy. Converting your term policy to Universal or Whole Life allows you to keep the same amount of coverage and even be rated the same as you were before, without having to answer a single health question. Many term policies are convertible to the end of the term or to a certain age, whichever comes first. Some are only convertible for part of the term.
If conversion is not an option, you must either pay the new higher premium, or purchase a new policy when your current term coverage expires.
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1) you can continue to pay premiums as the policy will be annually renewable, however, the premiums will start to go up each year (based on age) by a substantial margin.
2) If the conversion period is still available, you can convert all, or a portion, of the face amount to a permanent policy with new medical underwriting.
3) you can stop paying premiums and let the policy lapse, thus ending your coverage.
4) you can apply for a new policy (can be with the same carrier or a new carrier) to secure a new term or permanent insurance policy.
If your health has gotten worse since you took out your term policy, you may not have the option to buy as much coverage as you would like, in a new policy. Converting your term policy to Universal or Whole Life allows you to keep the same amount of coverage and even be rated the same as you were before, without having to answer a single health question. Many term policies are convertible to the end of the term or to a certain age, whichever comes first. Some are only convertible for part of the term.
If conversion is not an option, you must either pay the new higher premium, or purchase a new policy when your current term coverage expires.