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What Happens When My Term Life Insurance Expires?

2011 June 13

Most term life plans are guaranteed renewable to age 90 or older, so they don’t really expire.  However, once the level premium period expires, the cost of the policy increases substantially on a yearly basis. The reason term life insurance is still the better option is because of the affordability and flexibility provided by the term you select and the other financial accomplishments that can be achieved during this time period. The basic premise for cash-value plans (Whole Life, Universal and Variable Life and Return of Premium Plans) is that you will need life insurance your whole life – so the plans overcharge you in the early years to pay the higher costs in the later years. Dave’s opinion is that if you buy term life insurance, then you avoid this over-payment period and use the savings to attack debt and to build savings. The insurance industry has convinced the public that you have to have life insurance for your whole life – but that’s simply not true! You only need life insurance when your death would cause your family financial hardship. By the time a 15, 20, or 30-year term policy expires, it is likely that you will no longer have a need for life insurance anyway. Learn more about the benefits of term life insurance.

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