What Happens When Term Life Insurance Expires?
People choose term life insurance because it offers coverage for a set time, usually 10 to 30 years, at a comparatively lower premium. If you outlive the term, your policy lapses, meaning there is no coverage for your beneficiaries when you die. This may leave your loved ones without the support they might need. To ensure they are protected, you may be able to renew your policy or convert it to permanent life insurance.
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Quick links
- Do Life Insurance Policies Expire?
- What Happens When Term Life Insurance Expires?
- What Happens If You Outlive Your Term Life Insurance?
- What Are Your Options When Term Life Insurance Ends?
- Do You Get Money Back If You Outlive Your Term Life Insurance?
- Why Term Insurance Expires & How to Avoid Gaps
- FAQs on Term Life Insurance Expiration
Key Takeaways
Term life insurance expires after the fixed term, unlike permanent life insurance that covers you for a lifetime as long as premiums are paid.
If you die within the term length, your beneficiaries can claim the death benefit.
If you outlive the term, the coverage stops and your beneficiaries don’t receive a payout.
If you still need coverage for your loved ones after your policy expires, you can renew, convert, or apply for a new policy.
Do Life Insurance Policies Expire?
Only term life insurance policies expire. They offer coverage for a fixed term between 10 and 30 years, with some companies offering 40-year terms. At the end of the term your coverage ends, and premium payments stop.
If you have a permanent life insurance policy, such as whole life or universal life, it doesn’t expire as long as premiums are paid. However, some universal life policies may lapse if the policy’s cash value is insufficient to cover internal costs.
With permanent life insurance, your beneficiaries can claim the death benefit whenever you die. But term insurance payouts are available only if you die within the policy’s term. If you outlive the term, the coverage stops.
What Happens When Term Life Insurance Expires?
In comparison to permanent policies, term life insurance is typically more affordable. A term policy covers you only for a fixed term and eventually ends. While it may help meet your life goals, it doesn’t offer lifetime coverage. Here’s what happens to term life insurance at the end of the term:
Coverage Ends
Once the term ends, your life insurance policy expires. If you die after this happens, your beneficiaries cannot claim the death benefit. Term insurance policies allow a death benefit payout only if you die within the policy’s term.
No Payout If You Outlive the Term
If you outlive the policy’s term, your family won’t receive a death benefit. However, some term policies are sold as “return-of-premium” term. This means that if you outlive your term, the premiums paid would be returned to you. However, premiums are typically much higher than traditional term policies.
Premiums Stop Once the Term Ends
When the term ends, the policy is inactive. Thus, you stop paying premiums when your life insurance expires. However, if you decide to renew or convert your policy, you will need to make new premium payments based on your age and health at that time.
Read: Renewable Term Life Insurance
What Happens If You Outlive Your Term Life Insurance?
Outliving a term life insurance means you've lived past the protection window that you purchased. Let’s say you purchased your term life insurance for 30 years, but you are still alive at the end of the term. If you had died during the thirty years, your life insurance beneficiaries could claim the death benefit, but since you survived, your coverage ends.
If you still need financial protection after this period, you may secure new coverage by renewing, buying a new life policy, or converting to a permanent policy for lifetime coverage; otherwise, you’re no longer insured.
What Are Your Options When Term Life Insurance Ends?
A term life insurance policy covers a specific number of years. That’s why it’s important to plan ahead of the expiration date to protect your loved ones financially. Ensuring longer-term coverage for your loved ones can help them cover debts, replace income, and fund other essential expenses. Here are some options you may consider when your policy ends:
Renew Your Term Policy
You can continue the benefits of your existing policy by renewing it. Many insurers offer renewal options at the end of the term, but premiums are based on your current age.
Convert to Permanent Life Insurance
You can also convert your term life policy to permanent insurance such as a whole or universal life policy if your policy has a conversion option. In comparison to term coverage, these policies offer lifetime coverage and cash value accumulation. Many insurers allow conversion without a medical exam or new underwriting process. Thus, a suitable option for those seeking long-term protection for their loved ones. Converting from a term to a permanent policy will typically come with a higher premium.
Apply for a New Policy
You can also apply for a new term or permanent policy. This can be a good option if you are in excellent health. Applying for a new policy may come with a higher premium since you’re older, but choosing a lower coverage amount can help lower premiums.
Not all insurers may offer renewal or conversion options. So in those cases, a new policy may be your best option.
Let the Policy Expire
Renewing, converting, or applying for a new policy makes sense for you if you still need coverage at the end of your policy. But if you don’t have any dependents, you already own a permanent life policy, or you opted for term insurance to meet a short-term goal, you can let the policy expire. If your children are grown, your debts are repaid, and no one depends on your income, you may decide to let your policy expire rather than bear additional premium costs for unnecessary coverage.
Expert Tip
I’m nearing the end of my term life policy, and I’m not sure whether to renew it, convert it, or buy a new one. How do I choose the option that makes the most sense for me now?
The best option for you will depend on your life goals, age, health, dependents, and your budget. If you’re healthy and you don’t need a high coverage amount, you could opt for a permanent policy with a smaller death benefit. On the other hand, if you have health issues, converting your term policy to permanent life insurance can be a good option. You can also renew your policy from year-to-year if you need short-term protection.
Senior Director Life Underwriting
Do You Get Money Back If You Outlive Your Term Life Insurance?
Term life insurance comes with a set period of when your beneficiaries can benefit from the coverage. In contrast to permanent policies, they include a lower premium and no cash value component. Typically you don’t get any money back when you outlive the policy. Here’s how it works:
Standard Term Policies
Typically, outliving the term life insurance policies does not result in any payout for you during your lifetime or for the beneficiaries when you die. You can’t expect a refund of premiums, a death benefit payout, or any growth potential, as there is no cash value component.
Remember, standard term coverage is designed to ensure financial protection only during the years you’re insured.
Return-of-Premium Term
In general, term policies do not offer a payout when you outlive the policy. However, some companies may offer “return of premium (ROP) term.” This means that if you outlive your term, you’ll receive a refund of premiums paid. It’s important to understand this option is generally expensive, and it refunds only if you keep the policy active for the full term. Not all insurers offer ROP term.
Alternatives If You Want Cash Value
Term life insurance doesn’t include a cash value component. Here are some permanent policy options that don’t expire and accumulate value over time that you may consider:
Why Term Insurance Expires & How to Avoid Gaps
A term life insurance policy can offer a financial shield for major expenses like raising children, debt repayment, or income protection. But the tenure is fixed, and the coverage may end after certain years. If you outlive the policy, there could be gaps in the coverage you need and the policy’s term, especially if you’ve dependents to look after or have remaining financial obligations. Here’s how you can avoid gaps in coverage:
- Be aware of your policy terms and end date to plan in advance.
- Review your financial needs every 2-3 years to know if you would need to renew or buy a new policy; don't wait for the policy’s last year.
- Compare premium costs for renewal, conversion, and buying a new policy.
FAQs on Term Life Insurance Expiration
When your term life insurance ends and you outlive the policy, your coverage stops and your beneficiaries cannot claim a death benefit. You also don't get any payout or return of premiums (unless you purchased an ROP term policy). This may leave your loved ones financially unprotected. If you still need coverage after the policy expires, you may renew your policy, convert to a permanent policy, or buy a new policy.
If you outlive your term insurance policy, your policy ends. You’re no longer covered, and your family won’t receive a payout if you die. If at the end of the term you still have dependents who rely on your income, you may decide to renew or convert your term policy, or purchase a new policy.
Typically, you don't get any money back if you outlive your term life insurance. But, if your policy is designed as a return-of-premium term, you can get a refund of premiums paid. However, premiums for this type of policy are higher and not all insurance companies offer it.
Some insurers automatically move expiring term policies into annually renewable term coverage and send a new premium bill, while others require you to opt in. If your policy does renew automatically, the premium will usually increase each year based on your current age. Check your policy’s renewal clause so you know whether your coverage ends outright or rolls into annual renewal terms.
Yes, in most cases you can convert your term life insurance to a permanent policy at the end of the term. Some insurers offer you the conversion option without a medical exam; however, the premium costs are typically higher than the initial premium you paid for term coverage. Converting your term policy to a permanent insurance can be a good choice for someone who wants lifetime coverage but may have health issues that would make obtaining a new policy difficult.
If your term life insurance expires and you still need coverage, you may renew, convert, or apply for a new policy. Among these, you can choose the best option for you depending on your age, life goal, and budget.
Author
Chief Underwriter
Expert review
Chief Compliance & Privacy Officer
Dec 10, 2025
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