What happens when your term life policy approaches expiration?
When you first secured your term life policy, you probably weren’t thinking about what would happen when it expired. But now, as your term nears its end, you might be wondering what your next steps are. Here are your options as your term life insurance policy approaches expiration.
- Shop for a New Term Life Policy
If you still need life insurance coverage as the end of your term approaches, then you need to start shopping for a new policy. You should begin this process as soon as possible because securing a new policy will require you to take several steps. For instance, you will have to compare rates and pass a medical exam before securing the coverage you need. So, start this process before your term ends so you can maintain continuous coverage when your policy expiration dates does arrive.
- Convert Your Term Policy to a Permanent One
If you have poor health and do not want to go through the medical exam required by term life insurance policies, then you may have the option to convert your policy into a permanent life insurance policy. When you ask about this option, your insurer will probably offer you different conversion options to choose from. Please note that converting a term life policy to a permanent one will mean higher premiums, typically 2-3 times what you were paying for your term life coverage. Additionally, it’s important to know that you must convert your policy within the time frame that your insurer offers.
- Renew or Extend Your Term Life Policy
If you are in poor health and have missed the deadline for converting your policy into a permanent one, then you can choose to renew your existing term life policy. However, if you take this option, then your premiums will increase for every year you keep this coverage. As most people cannot afford this option long-term, this option is only recommended if you need only coverage for one or two years past your term expiration.
These are some of the things that you can do when your term life insurance comes to an end. Do you have additional questions regarding your life insurance? If so, then contact the experts at Randy Jones Insurance Services in Pleasanton, California. We are ready to assist you with all your coverage needs today.