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What Happens After My 10, 20, or 30 Year Term Expires?

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Term Policy Taking on Water

Is Your Term Life Insurance Policy Taking on Water?

Let’s say you have a 10 year level term life insurance policy.

What happens after the 10 years is up?

Do you lose your life insurance coverage?

Most people assume that if they have a “10 year term policy” or “20 year term policy” that their coverage ends at the end of the term.  In most cases, this is not true.

Myth – Term Life Insurance “Expires” when Initial Term Ends

Most term life insurance policies actually cover you to age 95

At the end of your initial term, most term policies do not expire.  However, the premiums will increase on an annual basis, in most cases, to an astronomical amount.

There are a few carriers, such as Lincoln, whose renewal premiums are not too outrageous.  You’ll need to wait for your first renewal premium notice to know for sure what your new premium will be.

Compare Term Life Insurance Rates

Why Do Premiums Increase after the Initial Level Premium Period?

When you buy a life insurance policy, let’s say at age 40, you could buy an annual renewable policy, which goes up every year since you’re older and for insurance purposes, are just a little riskier to insure.  So annual renewable life insurance policies are available, but they’re not very popular since the premiums go up every year.

Your premiums for a $1,000,000 male non-smoker might be $250 for the first year.  Then $265 in year 2, $275 in year 3, and so on, until 10 years later when you’ll pay about $450 for the coverage.  This is an example of annual renewable life insurance.

Since most people would rather plan their budget around fixed expenses, many insurance carriers offer level term life insurance policies.  In essence, they’ll still cover you until age 95, but for a fixed term, say 10 years, or 15, 20, or 30 years, your premium (payment) is fixed.

Calculating Level Term Premium – It’s a Simple Average

In the example above for 10 year term life insurance, they would add up the premium for each of the first 10 years and divide it by 10, and that would be your premium for the first 10 years.  So essentially, 10 year level term life insurance just charges you an average premium for your first 10 years you’ll be covered.  Then in years 11 and up, or in the case above, from ages 50 to 95, it reverts to annual renewable insurance coverage.

If you can understand that, then you’ll see the importance of locking in as long of a level term as you think you might possibly need coverage, because once the level term is up, your premiums will skyrocket, and eventually become unaffordable.

What to do if my Term Policy is about to “Expire”

If you have a policy whose initial term period is almost up, you have several options with most policies.

  1. Replace the Policy for a cheaper one – If you’re still healthy enough to get a new policy, you might consider applying for a new term or permanent policy.  It will most likely cost a fraction of the renewal premium of your current term policy.
  2. Convert the Policy – Check the policy’s conversion features.  You may be able to convert the policy to a permanent policy without evidence of good health.  If your health has diminished since the term policy was issued, this may be a good option for you.  See notes on term policy conversion here.
  3. Pay the Renewal Premium – If you can’t afford to convert your policy or replace it, you might consider paying the renewal premium.  You’ll have to take your health and estimated life expectancy into account here, as well as how long you still need the coverage.  If you need it for several more years and you’re still healthy, it’s probably best to bite the bullet and buy a new policy.
  4. Decrease your Death Benefit – Many companies will allow a one-time decrease in face value to your policy, which will reduce your premiums.
  5. Let your Policy Lapse – If none of the above are valid options for you, and you can either no longer afford your policy or no longer need your policy, simply stop paying premiums and the policy will lapse.

Other Resources you want to read:

I’ve written a couple other articles on this site you will want to read before deciding on whether to replace your policy or convert it.

Replacing a Life Insurance Policy

Understanding Life Insurance Conversion

How Guaranteed Level Term Life Insurance Works

*Written by Chris Huntley. Huntley Wealth Insurance and its representatives do not give legal or tax advice. Please consult your own legal or tax adviser.
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Chris Huntley
Chris Huntley is the owner of Huntley Wealth Insurance, a San Diego life insurance agency. You can find him on Google + and Facebook. Over the past 8 years, Chris has consulted with over 2000 individuals about their insurance needs. He is a proud husband and father to three adorable girls.
Chris Huntley
Chris Huntley

What will happen to my term life insurance policy when my term is up? Does it cancel?

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{ 48 comments… add one }

  • charlie January 22, 2013, 1:44 am

    a friend of mine mom died and she had old life insurance polices and they were rockford , he went to cash them in and they are no longer around so what happens when you cant pay for the funreal because the policies were old and they are no longer around to cash them

    • Chris Huntley January 23, 2013, 3:15 pm

      Chances are they were acquired by someone else. Perhaps you can track them down through a google search.

  • Gene February 19, 2013, 2:14 pm

    Dear Mr. Huntley,

    What happens when a Term Life Insurance Policy lapses? Obviously there is no coverage anymore, but is any of the money paid in over 20 years recovered?

    Thank you,


    • Chris Huntley February 23, 2013, 1:02 pm

      No money is paid back. You no longer owe premiums and the insurance company no longer owes a death benefit upon your death.

  • FLOYD MARTIN April 14, 2013, 3:26 pm

    So you pay and pay into term then after 15 to 20 years they can jack your rates up to the moon?
    Where as if a old person pays into Whole Life it is forever and will never expire!
    It would appear to me anyone over 60 would be a fool to buy term!
    Old age term sounds good for the Insurance company!

    • Chris Huntley April 21, 2013, 11:14 pm

      I respectfully disagree, Floyd. There’s a host of reasons why someone in their sixties would only need coverage for a short period of time, such as a ten year period. For example, it could be to secure an sba loan, or for a business buy-sell agreement, or maybe you plan to work for 10 more years and only need the coverage while you’re working. Why would any of these people buy whole life insurance when they could pay 1/10 the premium for term?

  • Edna Tabor January 13, 2014, 1:30 am

    I had a 5 year term policy. They continued to take the money out of my pay role for 10 years. Then when the insurance agent contacted me last week he said that my policy expires in Feb.and I needed to sign up again. How did they renew my policy after the first 5 years without contacting me?

    • Chris Huntley January 30, 2014, 10:41 am

      Perhaps it automatically moves to annual renewable term after the initial level term. Many policies work this way.

  • Bob April 8, 2014, 2:15 pm

    Hi Chris,

    At 50 my father opened a life policy for 25K, it expires next year at age 80.
    He turns 80 next year, the policy is active and will be paid in full next year.

    He doesn’t want to open a new one, so what becomes of that policy?
    If he passes in the next 5-10 years will that policy still pay him 25K, even if it’s paid up , but he did not renew it? Actually mo mother is the benficiary, will she be entitled to the 25K?

    Thank you,

    • Chris Huntley April 16, 2014, 8:38 am

      If it’s a term policy, then it’s not “paid up”. Instead what will likely happen is his premiums will increase next year if he wants to continue the coverage.

  • Tracey Howes April 16, 2014, 3:54 pm

    Hi, my mother in law forgot her life insurance policy was due to expire and so on 15th March this year it expired. Just a week later she felt ill and last week (less than a month after the policy expired) she passed away from advanced womb cancer that had gone undetected.
    It seems incredibly unfair and ironic that for the last 30 odd years she had paid £20 a month for insurance and 3 weeks after it expired she passed away. In this circumstance is there ever a chance an insurance company would pay out?

    • Chris Huntley April 18, 2014, 12:12 pm

      Hello Tracey,
      This is a terrible tragedy. I’m so sorry.

      I think if you could prove that perhaps she missed the payment due to mental incapacity, you may have a case, but to be honest, I have no idea. The carrier typically sends out multiple notices, and provides a 30 day grace period usually after you miss payment in which you can make your premiums current with no affect on coverage.

      You might talk to an attorney about it, but honestly, I just don’t know. Again, so sorry for your loss.

  • sophia April 21, 2014, 12:42 pm

    What would the best insurance policy for someone 50 years old to purchase

    • Chris Huntley May 5, 2014, 9:27 am

      Hello Sophia,
      Depends on what you are trying to accomplish. I just emailed you.

  • Darlene July 19, 2014, 10:31 pm

    What would the best insurance policy for someone 50 years old to purchase


    • Chris Huntley July 21, 2014, 1:18 am

      Hello Darlene,
      Depends on your health. We will be in touch with you to discuss the best option for your insurance needs.

  • judi nunes November 8, 2014, 8:01 am

    With a term life policy that expires at age 80, my question is this. Does it expire ON the day of the 80th birthday or is it valid THRU the year until the 81st birthday. Thank you

  • Frank German November 12, 2014, 10:02 pm

    If my relative have paid on insurance policies for 40 plus year do they ever pay off or do they have keep on paying.

  • George December 27, 2014, 1:02 am

    I have a Ca life insurance sales license however I’m not currently with a company. I want to grow a book of business on a part time bases while doing what is write for my clients. Do you have an suggestions as to the best company for me?

  • Rick January 12, 2015, 8:33 am

    If i have paid life insurance for 25 years and its about to expire can I cash it in or have I paid 25 years worth ov insurance for nothing . Thank you

    • Chris Huntley April 29, 2015, 11:47 am

      Sounds like you have term and you have nothing. You could possibly convert it into a permanent policy and sell the policy though. Give us a call at 877-443-9467.

  • Louise January 22, 2015, 8:50 am

    Hello Chris,

    A quick question: I was bequeathed a term policy for my father. We no longer have contact, but I still pay the premium. I wanted to ask, if he outlives the term of the policy, is there any refund of the premiums or is it a wash?


    • Chris Huntley February 24, 2015, 3:23 am

      If your Father outlives a Term life policy the company does not offer a refund of the premiums.

  • Jane February 4, 2015, 5:23 pm

    So, from what I am reading, if I have paid premiums for a term life insurance policy, if the premiums stop after the pre-determined number of years, and if I continue living, is the only way any money would be paid out from that policy would be if I died before it was paid up?

    • Chris Huntley April 29, 2015, 11:49 am

      Yes that sounds right. When you stop paying premiums, your policy will lapse.

  • Faye February 8, 2015, 8:20 am

    I am a healthy 52 yr. old and would want to get life insurance. My goal is when I leave this world, I would want to leave a good chunk of money to my daughter. I don’t want to leave her in dire straights. I have a good 16-20 years on me and I am work probably well into my 70’s. I don’t want a policy that expires on my 80th birthday, I may live longer than that since my own parents are healthy 98 & 101 yrs. old.

    • Chris Huntley February 24, 2015, 3:16 am

      One of my colleagues will be in touch with you to work up a few affordable term quotes based on your specific needs.

  • Penny March 24, 2015, 10:34 am

    As I understand term policy,if my husband dies any time during the term I will be paid the $15,000.00, as long as I keep up the payments. He has a lot of health issues and I really don’t think he’ll live even another 10 years, but I plan to have a 20 year term anyway. just in case. We don’t have a lot of money for premiums, that’s why I’m thinking term. Would AARP be the best way to go ? please answer via my email .

    • Chris Huntley April 13, 2015, 3:13 am

      Hi Penny,
      One of our agents will be getting a hold of you to discuss your Husband’s insurance needs.

  • Tanneaka alexander March 29, 2015, 6:03 pm

    Not clear on what happens with my term insurance when I turn 80. If I die at 85 am I covered? Or at 81 do I need to buy another policy?

    • Chris Huntley April 29, 2015, 12:13 pm

      A lot of companies set 70, 75, or 80 as the max age you can convert to a permanent policy. Give us a call if you have any questions. 877-443-9467

  • Cathy May 8, 2015, 6:31 am

    My husband handled all the finances including life insurance. He will be 73 this year and his health is failing. We had life insurance auto deducted from our checking each month, but last statement I did not see it. He swears that it is still active, I believe something is wrong. We have debt, and if something happens to him without being able to pay our bills, I’m sunk. Would it be possible to take out life now? We had $200,000 but I’m thinking there’s no way we could get that amount again if the other ins is gone.

    • Chris Huntley May 25, 2015, 1:40 am

      It sounds like there are a few questions here. The ultimate answer will revolve around your husband’s current health conditions. You mentioned his health is declining. Give us a call at 877-443-9467 and we can answer all of your questions.

  • Mary Koupal June 10, 2015, 7:16 pm

    My husband has a policy for 50,000. We are told the insurance is termed out in Nov. I am told it is a universal life policy. They have never told us to increase the payment and I can’t even get the agent we used to call me back. I leave him a message every day. He told me a week and a half ago he would call me back.

    What should I do? The policy is with American General insurance co

    Mary koup@sbcglobal.net

    • Chris Huntley August 28, 2015, 2:55 am

      Unfortunately, I cannot speak as to the terms and conditions of a specific company or policy. Each company has their own terms for each type of policy. Feel free to give us a call should you be in the market for a new agent and policy. 877-443-9467

  • Amy June 15, 2015, 9:54 am

    I’m reading these ???
    Seems to me that irs best to save money in your bank account then paying life insurance policy. That will leave you hanging from nothing!! Right?? Or are there some that really keep there promise!! My husband payed for his insurance it kept increases yearly. Does it increases with age?.

    • Chris Huntley November 8, 2015, 3:09 pm

      Hi Amy,
      Yes, the cost of a life insurance policy does increase based on your age.

  • AG June 16, 2015, 2:31 pm

    Hi! I am contemplating on getting a term life insurance that has the feature of return premium. I am doing this for my son. I still need to understand how it works, if I get a 30-year term life, does it mean that I have to pay for 30 years as well or do I pay for a certain period of time and then I am covered until the 30th year. Thank you.

    • Chris Huntley August 28, 2015, 2:59 am

      Hi Anna

      I’ve forwarded your information to Cliff Pendell to help you with your insurance needs

  • Jerry June 16, 2015, 2:57 pm

    If a policy lapses and the premiums which were once being met are now not met for a period of time, is value of the policy essentially worthless? Any way to recoup the money that was originally invested in the policy?

    • Chris Huntley August 28, 2015, 2:43 am

      Yes that sounds right. When you stop paying premiums, your policy will lapse. Nope, the insurance company keeps the money you invested in the policy.

  • P clayton June 21, 2015, 8:05 am

    I have been paying on a 10 year term policy that will expire in 2019. Once it expires, does that mean there will not be any money paid out?

  • Cecilia Jaconetti August 27, 2015, 5:44 pm

    My brother turned 80 and they raised his premiums so high…are there companies that buy Insurance polices…and how do you find out who they are…

    • Chris Huntley November 8, 2015, 2:58 pm

      Hi Cecilia,
      No there are not any companies that buy insurance policies.

  • Teresa September 26, 2015, 8:48 pm

    I am 61 years old and have paid on term life insurance for many years. Policy is due to expire in my 60’s or early 70’s. My parents are 86 and 90 so I would like coverage to last longer. Question: I have borrowed money from the policy and have not paid any of it back. As of right now the loan amount is around $12,000. I realize that if I died today the $12,000 would be deducted from the $108,000 value of the policy. When policy expires am I required to pay back the loan amount? I cannot find an answer anywhere.

    • Chris Huntley November 16, 2015, 2:47 am

      Hi Teresa,
      Most term life inusrance policy do not hold a cash value which allow you to borrow against. In any case, borrowing against a whole life insurance policy does incur a interest penalty, just like any loan. You will need to check the terms of when your company will be collecting the interest
      Thanks for reading

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