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Term life insurance is temporary life insurance coverage, unlike permanent life insurance which lasts your entire life. You choose the length of the term which can vary from 10-40 years.

Your premiums are fixed during that entire period. For example, if you buy a policy with a 30-year term, you are insured for 30 years and your premium will never increase during those 30 years.

What happens to term life insurance if you don’t die?

If you die during the term, your beneficiaries receive a death benefit check from the insurance company after submitting a claim. However, if you don’t die (which is what you and your family are hoping for) then your coverage simply ends at the end of the term.

What age does life insurance expire?

The expiration of your life insurance policy depends on whether it’s term or permanent.

A permanent life insurance policy is typically set up to “mature” at age 121. So, essentially, it’ll be inforce your entire life.

Term life insurance expires at the end of term. Your age does not determine the expiration date.

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Do you get your money back at the end of the term?

No. If you outlive your term life insurance policy, the money you have put in will stay with the insurance company.

Term life insurance is not a savings or investment plan. It’s protection for your loved ones against your untimely death. Ideally, you’ll no longer need life insurance once your term expires.

Where does my money go?

Everyone who is paying life insurance premiums is essentially putting their money in a large metaphorical bucket managed by the life insurance company. The company then invests all the money they receive to fill the bucket to ensure they can pay out all necessary claims.

When an insured person dies, the company reaches into the bucket to pay out the death benefit. Your money helps another family in need of financial support because of a lost loved one.

If you die during the term of your policy, the company reaches into that bucket that everyone is paying into and gives that money to your beneficiaries.

For those who don’t understand why they don’t get a refund if the coverage isn’t used, we ask that you consider your car insurance. You pay your car insurance premiums to protect against the what-ifs.

You don’t actually hope you get into a car accident, right? And if you don’t use your car insurance, and then sell your car, you don’t get refunded the insurance premiums, do you?

Term life insurance is a similar concept. You buy life insurance coverage during your earning years, the years your family relies on you the most, and just hope your family doesn’t have to use it. But if the worst should happen, the term life insurance coverage is there to help your family financially.

What if I have a (ROP) return of premium term policy?

If you have a return of premium term life insurance policy, you get back the premiums you paid if you outlive your term.

Owners of ROP policies pay higher premiums for the benefit of knowing they get back their money if they don’t die during the term. Consider the comparison quotes table below.

Estimated Monthly Cost of a 20-Year $500,000 Policy for a Healthy Male
AgeTerm PolicyROP Term Policy
30$19.10$94.60
35$20.40$101.64
40$28.48$141.24
45$46.04$220.44
50$70.33$362.56
55$113.31$653.40
60$200.75$1,023.88

What if I outlive my policy but still want coverage?

If your term life insurance policy is ending and you want to continue to make sure your family is protected, you have some options,

  1. You can convert the policy into a permanent one.
  2. You can renew your term coverage.
  3. You can buy a new policy.

Converting Your Policy

Many term life insurance policies have a conversion rider automatically included. The rider would ensure you can convert your term policy regardless of your age or health status as long as you convert before the deadline.

The benefits of converting a term policy:

  • You don’t have to go through underwriting or take a medical exam.
  • You maintain the original health rating from the term policy.
  • You can decide when and how much of the coverage to convert.
  • You can opt to have life insurance coverage for your entire lifetime.

If you decide to convert, your premiums will increase drastically. You’ll no longer have a term policy, but a permanent policy.

A conversion option is typically only taken advantage of if your health has declined and you’re no longer insurable otherwise.

If you’re interested in converting, be sure to check the conversion expiry date listed on your policy.

Renewing Your Policy

Another option is to renew your term policy. Many insurance companies have renewability options on their term products. This means you can extend the coverage term year after year without having to re-qualify.

For example, let’s say you purchased a $500,000 20-year term life insurance policy when you were 30 years old. Your annual cost is $244.

You’re now 50 years old and your policy is set to expire this year. You can choose to renew the policy to extend the coverage another year. This means you’ll keep your $500,000 in coverage but you’ll no longer qualify for the $244 annual premiums. The renewal premiums jump to $2,989 annually for the 21st year. Each year you renew, these annual premiums will increase.

The benefits of renewing a term policy:

  • Allows you to reclaim your coverage at the end of your initial term.
  • Allows you to keep the original face value amount (or death benefit) of your policy.
  • Permits you to renew your term life policy without having to start the application process again.
  • Exempts you from answering medical questions or undergoing a medical exam to prove insurability.

Similar to converting, people don’t typically opt to renew their policy unless they are only given a short amount of time left to live due to terminal illness.

Buying a New Policy: A More Affordable Option

You don’t need to be terminally ill to realize you want more life insurance coverage. Perhaps life didn’t go as planned and you’re still paying off large debts or your children aren’t quite financially independent yet. Or maybe you and your spouse bought a vacation home and you want to cover that new mortgage. No matter the reason, sometimes buying a brand new policy is the best way to continue being insured.

Converting and renewing policies can be quite expensive. Before going either of these routes, try applying for a new term life insurance policy. It’s likely going to be the less expensive route, even if a health issue or two have popped up over the years.

You don’t need to get the same policy as you had before or even work with the same insurance company. A different insurance company may offer better rates than your current one. Get a range of quotes in different term lengths and coverage amounts until you find a price you’re comfortable with.

No one ever anticipates needing to use life insurance, but if the unexpected happens make sure your loved ones are protected. Be prepared and get a free and anonymous term life insurance quote today.

Note: Life insurance quotes used in this article accurate as of August 9, 2022. These are only estimates and your life insurance costs may be higher or lower.

Watch the What If I Outlive My Term Policy Video

About the writer

Headshot of Natasha Cornelius, a life insurance writer, for Quotacy, Inc.

Natasha Cornelius, CLU

Senior Editor and Licensed Life Insurance Expert

Natasha Cornelius, CLU, is a writer, editor, and life insurance researcher for Quotacy.com where her goal is to make life insurance more transparent and easier to understand. She has been in the life insurance industry since 2010 and has been writing about life insurance since 2014. Natasha earned her Chartered Life Underwriter designation in 2022. She is also co-host of Quotacy’s YouTube series. Connect with her on LinkedIn.